In the present work, thermoplastic elastomer (TPE)-clay nanocomposites (TPN) based on different rubber-plastic blends from ethylene-octene copolymer [Engage]-Polypropylene and brominated poly(isobutylene-co-paramethyl styrene)-nylon 6 were prepared by melt blending. Hexadecyltrimethylammonium bromide and octadecyl amine-modified sodium montmorillonite were used as organoclays. The nanocomposites were prepared by adding the nanoclay separately into the rubber and plastic phases. The TPNs were characterized with the help of transmission electron microscopy (TEM) and X-ray diffraction. The X-ray diffraction peaks observed in the range of 3-10 degrees for the modified clays disappeared in the thermoplastic elastomeric nanocomposites. TEM photographs showed exfoliation and intercalation of the clays in the range of 20-30 nm in the particular phase where the clay was added. Excellent improvement in mechanical properties like tensile strength, elongation at break, and modulus was observed on incorporation of the nanoclays in the rubber phase of TPN. When the nanoclay was added to the plastic phase, the mechanical reinforcement is comparatively poorer due to partial destruction of the crystallinity. (c) 2005 Wiley Periodicals, Inc.