Nanoscale control of structure in polymer nanocomposites is critical for their performance but has been difficult to investigate systematically due to the lack of a suitable experimental model. In this work, we investigated the role of nanoparticle layer separation in the finite deformation response of layered polyurethane-(PU-) montmorillonite (MTM) nanocomposites. A series of multilayered nanocomposites was manufactured, with alternating PU and MTM nanolayers, using a layer-by-layer manufacturing technique. The systematic variation in MTM nanoparticle volume fraction was achieved by varying the thickness of the PU nanolayer and therefore the MTM layer separation. Traditional polymer nanocomposite blending techniques result in a wide variation in nanoparticle separation for a given nanocomposite. In this investigation, we controlled the MTM nanoparticle layer separation, which allowed us to examine its effect on the nanocomposite response over a broad range in nanoparticle volume fraction. The PU-MTM nanocomposites demonstrated an increasing yield strength and stiffness with increased MTM volume fraction or reduced nanoparticle layer separation. A transition from ductile to brittle behavior in the stress-strain constitutive response was observed at a high volume fraction of MTM nanoparticles. We demonstrate that a critical nanoparticle separation exists, below which brittle behavior dominates the response of PU-MTM nanocomposites.