In this study, polylactic acid (PLA) was blended with polyhydroxybutyrate-valerate (PHBV) with different ratios of rice straw (RS) particulate content and polyethylene glycol (PEG) which acted as a plasticizer. The tensile, thermal and water absorption properties were investigated. The tensile strength and elongation at break, E (b), decreased with increasing RS particulate. The poor adhesion between RS particulate and PLA/PHBV blends was proven through scanning electron microscopy. Besides, the reaction scheme between RS particulate also has been proposed. Increased RS particulate loading and PEG presence also reduced the crystallinity of the blends. Thermal stability of the composites also decreased with the addition of RS particulate and PEG into the blends. The presence of RS particulate increased the water absorption, whereas the addition of PEG reduced water uptake due to its amphiphilic behavior. The mechanism of the effect of water absorption on PLA/PHBV blends and RS particulate was also proposed.