We report a novel method to exfoliate and disperse single-wall carbon nanotubes (SWNT) into organic and aqueous solutions. The method is based on treatment of single-wall carbon nanotubes with a solution of hydroxylamine hydrochloric acid salt [(NH2OH)(HCl)] and does not require truncation of the tubes or surface adsorption of organic molecules. The solution dispersed tubes can easily be incorporated into an organic matrix in order to obtain a nanocomposite. We illustrate the method by forming PMMA-SWNT and PS-SWNT nanocomposites. 1% SWNT PMMA nanocomposite having a draw ratio of similar to6 showed a dramatic 7x increase in the strain to fracture compared to fibers of similar draw ratio made from pure PMMA.