Polypyrrole (PPy)/graphene oxide (GO) nanosheet composites with different GO content have been successfully prepared. The morphology, microstructure, defect property and conducting mechanism were examined by Raman spectroscopy, Fourier transform infrared spectroscopy (FTIR), field-emission scanning electron microscope (FE-SEM), X-ray photoelectron spectra (XPS), positron annihilation technology (PAT), and electrical conductivity measurements for PPy/GO conducting nanocomposites, respectively. Experimental results indicated that PPy was deposited onto the GO surface homogeneously. Four orders of magnitude increase in electrical conductivity was successfully achieved with small quantities of GO compared to pristine PPy. In order to elucidate the conducting mechanism, an electron transfer model was used to describe bipolaronic formation, which can be confirmed by XPS and positron annihilation parameters measured including positron annihilation lifetimes, positron annihilation Doppler broadening spectroscopy (DBS) and continuous distribution of positron lifetime. Electronic conductivity enhancement can be attributed to (a) the interfacial interaction between the GO layers and PPy results in the electron transfer, which leads to the increase of bipolaronic concentration, and (b) the pi-pi stacking between the GO layers and PPy can improve the conjugation degree of the PPy chains and the longer conjugation length makes the conducting particle delocalization more easily, leading to the increase in electron mobility. On the other hand, the continuous conducting network structure of graphene nanosheets homogeneously dispersed in the PPy matrix and carriers between localized states formed at the graphene-PPy interfaces where hopping occurred, also result in increase of conductivity.