The aim of this work is the production of new nanoconposites from metallocene polyethylene-octene elastomer (POE), montmorillonite and biodegradable starch by means of a melt blending method. Characterizations of clay, modified clay, POE, POE-g-AA, and the hybrids produced from polymer, clay, and/or starch were performed by X-ray diffraction (XRD) spectroscopy, Fourier transform infrared (FTIR) spectrophotometer, differential scanning calorimetry (DSC), thermogravimetry analyzer (TGA), scanning electron microscope (SEM), and Instron mechanical tester. As to the results, organophilic clay can be well dispersed into acrylic acid grafted polyethylene-octene elastomer (POE-g-AA) in nanoscale sizes since cetyl pyridium chloride is partially compatible with POE-g-AA and allows POE-g-AA chains to intercalate into clay layers. Based on consideration of thermal and mechanical properties, it is also found that 12 wt % of clay content is optimal for preparation of POE-g-AA/clay nanocomposites. The new partly biodegradable POE-g-AA/clay/starch hybrid could obviously improve the elongation and the tensile strength at break of the POE-g-AA/starch hybrid since the former can give the smaller starch phase size and nanoscale dispersion of silicate layers in the polymer matrix. The nanocomposites produced from our laboratory can provide a stable tensile strength at break when the starch content is up to 40 wt %. © 2005 Wiley Periodicals, Inc.