Poly(vinyl chloride)/organophilic montmorillonite (PVC/OMMT) nanocomposites were prepared by means of melt blending. A liquid epoxy resin was used to aid PVC chains in intercalating into silicate layers. The effects of the preparation methods and epoxy resin contents on the melt intercalation of PVC were investigated. The morphology development, mechanical properties and optical properties of the PVC/OMMT composites were tested as functions of epoxy resin content and OMMT content. Wide-angle X-ray diffraction, transmission electron microscopy and scanning electron microscopy were used to characterize the morphology of the resulting composites. After being pretreated by the epoxy resin, the OMMT layers were largely intercalated into the PVC matrix, and even exfoliated at high epoxy resin content. The addition of epoxy resin led to a decrease in optical clarity of the composites but improved the processing stability, as indicated by yellowness index and haze measurement. However, the optical clarity of the composites containing 4 phr of epoxy resin (PVC/E-OMMT) was improved by increasing the OMMT content, as shown by light transmission. Both the tensile strength and notched Izod impact strength of the PVC/E-OMMT composites reached their maximum values when the OMMT content was 0.5 phr and the epoxy resin content was 2 phr. With further increase of the OMMT content and the epoxy resin content, the tensile strength decreased but was still higher than that of original PVC. The method of addition of epoxy resin had little effect on the physical properties but mainly influenced the morphology of PVC/OMMT nanocomposites. (C) 2003 Wiley Periodicals, Inc.