The intercalation and exfoliation of talc have been realized by solid-state shear compounding (SIC) using panmill equipment that can exert fairly strong shear forces and has multifunctions such as pulverizing, mixing, and activation on materials. The structural features of panmill also show prospective in delaminating layered minerals. The morphology and structure of talc were investigated by using transmission electron microscopy (TEM) and X-ray diffraction (XRD). The characteristic peaks of talc interlayer spacing disappeared in the XRD pattern of PP/talc composite prepared by SIC, however, still remained in the XRD pattern of PP/talc prepared by the conventional mixing method. TEM confirms the intercalated and exfoliated structure of talc, and the well dispersion of talc in the PP matrix after talc and PP were co-milled. (SC)-C-3 is a new approach to prepare polymer/ layered inorganic filler nanocomposite and has characteristics such as a simple process that needs neither organic ligands nor solvent. (c) 2005 Society of Plastics Engineers.