Despite considerable advances, it remains imperative but challenging to develop high-performance waterborne polyurethane (WPU) which combines with robust mechanical, thermal and flame retardant properties. Considering its unique structure and properties, graphene has been reported as a potential alternative to ameliorate the integrate performance of polyurethane. However, one of the intractable handicaps is how to effectively disperse graphene and enhance its interfacial interaction towards polymer matrix. We herein demonstrate the fabrication of WPU composite by covalently conjugating with hydroxyl-functionalized graphene oxide (fGO), which was wrapped with P-N flame retardants, using an in situ polymerization strategy. Results indicated that a nanostructured WPU/graphene composite (WPU/fGO) with molecular-level uniformity was prepared. Compared with pure WPU, the peak heat release rate and total heat release were significantly reduced by 39.2% and 18.6%. The well dispersion, lamellae blocking effect of graphene nanosheets and the catalytic charring performance of P-N flame retardant were conducive to the improved fire safety. Moreover, WPU/fGO composite exhibited a 139% enhancement in tensile strength, while maintaining the superior elongation at break (high as 857.5%). Overall, this effective yet promising paradigm may provide an achievable solution toward developing graphene-based polymer nanocomposites simultaneously with high fire safety and well-balanced comprehensive performances.