Polymer nanocomposites (NCs) are a special class of materials having unique properties and wide application potential in electronics and other diverse areas. In this study, NCs consisting of poly(3,4-ethylenedioxythiophene)/poly(4-styrene sulfonate) (PEDOT:PSS) matrix reinforced with graphite nanosheets were fabricated by solution method. The graphite used was functionalized before fabrication of NCs. The functionalized graphite was characterized by transmission electron microscopy (TEM) and Fourier transform Infrared spectroscopy (FTIR) technique. The NCs prepared were characterized by X-ray diffraction (XRD), scanning electron microscopy (SEM), and FTIR technique. The conductivity studies of the prepared NCs were carried out. The prepared NCs films were investigated for the detection of nitrobenzene vapors. The detection mechanism is based on measuring resistivity changes that occur in a NC due to the absorption of nitrobenzene vapors by PEDOT:PSS film. These sensors exhibited excellent response at room temperature when exposed to vapors of nitrobenzene. Sensitivity as high as 18.5% was observed for PEDOT:PSS/NGPs composite. The chemresistor exhibits a fast response (approximate to 1.14 min) and good recovery time (approximate to 1-2 min). The response of NC to the nitrobenzene vapors is reproducible. POLYM. ENG. SCI., 53:2045-2052, 2013. (c) 2013 Society of Plastics Engineers