We have synthesized a new polyhedral oligomeric silsesquioxane (POSS) containing eight phenol functional groups and copolymerized it with phenol and formaldehyde to forrn novolac-type phenolic/POSS nanocomposites exhibiting high thermal stabilities and low surface energies. Our DSC results indicate that the glass transition temperature of these nanocomposites increased initially upon increasing their POSS content, but then decreased at POSS content above 10 wt.-%, presumably because of the formation of relatively low molecular weight species and POSS aggregation as evidenced from MALDI-TOF mass analyses. Our TGA analyses indicated that the 5-wt.-%-mass-loss temperatures (T-d) increased significantly upon increasing the POSS content because the incorporation of the POSS led to the formation of an inorganic protection layer on the nanocomposite's surface. XPS and contact angle data provided positive evidence to back LIP this hypothesis. In addition, contact angle measurements indicated a significant enhancement in surface hydrophobicity after increasing the POSS content.