A novel thermoplastic polyurethane was prepared from cardanol, a renewable resource and a waste of the cashew industry. Cardanol was recovered from cashew nut shell liquid (CNSL) by double vacuum distillation. It was characterized by CHN analysis and IR, H-1-NMR, and C-13-NMR spectroscopy techniques. Cardanol is a meta-substituted long chain phenol. The long aliphatic chain unit substituent was found to be a monoene. The monomer, 4-[(4-hydroxy-2-pentadecenylphenyl)diazenyl] phenol was prepared from cardanol. It was a dihydroxy compound as characterized by CHN analyzer, UV, and 1H-NMR spectroscopy. The polyurethane was synthesized from this dihydroxy compound by the treatment with 4,4＇-diphenylmethane diisocyanate (MDI) in dimethylformamide (DMF) solvent at 80-90 degrees C under nitrogen atmosphere. The polymer was characterized by 1H-NMR, FTIR, and UV spectroscopy. The elemental analysis was done for determining the percentage content of C, H, and N, and the intrinsic viscosity [eta] Of polymer showed 1.85 dL/gm. Thermogravimetric investigations (TGA) of the cardanol, the dihydroxy compound, and the polyurethane were performed to study their decomposition. The semicrystalline nature of the PU was confirmed by differential scanning calorimetry (DSC) and dynamic mechanical thermal analyzer (DMTA). The wide-angle X-ray diffraction (WAXS) study of PU shew a broad amorphous halo indicative of absence of crystallinity in the polymer, which has been explained as due to strong hydrogen bonding in the hard phase. PU may possibly be useful as a telecommunication and as a nonlinear optical material.