The rheological behaviour, dispersion, crystallization behavior, mechanical properties, fracture surface morphology of polyethylene (PE)/TiO2 nanocomposites prepared by melt compounding were investigated using rheometer, energy dispersive X-ray spectrometer (EDX), polarized microscopy, impact tester, universal testing machine and field-emission scanning electron microscopy (FE-SEM). The rheological analysis indicated a fine dispersion of TiO2 during the melt compounding. The large scaled surface dispersion of TiO2 nanoparticles was revealed by the EDX composition distribution maps. The introduction of 2.0 wt% TiO2 in composites improved the mechanical properties significantly compared to neat PE, and resulted in 45% increase in notched impact strength. Moreover, the further analysis and discussion showed the mechanical properties of the composites were controlled by the dispersion conditions of TiO2 and its nucleating effect on PE crystallization.