Improvements in Young's modulus and strength (tenacity) of poly(ethylene terephthalate) (PET) fibers were obtained by drawing unoriented nanocomposite filaments containing low concentrations (<3 wt%) of various organically modified montmorillonites (MMTs) in a second step at temperatures above the glass transition. Prior to melt spinning, solid-state polymerization was used to rebuild lost molecular weight, due to MMT-induced degradation, to a level suitable for producing high strength fibers. Greater improvements in mechanical properties occurred when the MMT stacks were intercalated with PET. A nominal 1 wt% loading of dimethyl-dehydrogenated tallow quaternary ammonium surface modified MMT in drawn PET fiber showed a 28% and 63% increase in Young's modulus and strength, respectively. Relative to an unfilled PET fiber, these results surpassed the upper bound of the rule of mixtures estimate and suggested that both the type of surface modification and concentration of MMT affect the degree of PET orientation and crystallinity. Furthermore, drawability above T-g, and elongation at break increased upon the addition of organically modified MMT to unoriented PET fibers, which was a key distinction of this work from others examining similar systems. POLYM. ENG. SCI., 50:2205-2215, 2010. (C) 2010 Society of Plastics Engineers