Clay was modified by trimethylchlorosilane; after modification, hydroxyl groups at the edge of layers were reacted and CEC value was drastically decreased. Polyethylene-clay composites were prepared by inert compounding. Wide angle X-ray diffraction (WAXD) and transmission electron microscopy (TEM) showed that intercalated nanocomposites were formed using organoclay ion-exchanged from chlorosilane-modified clay, but conventional composites formed using organoclay directly ion-exchanged from crude clay. Dynamic mechanical analysis (DMA) of PE and PE-clay composites was conducted; the results demonstrated that nanocomposites were more effective than conventional composites in reinforcement and addition of organoclay resulted in the increase of glass transition temperature (T-g), but crude clay had no effect on T-g of PE-clay composites. (C) 2004 Wiley Periodicals, Inc.