Nanocomposites based on thermoplastic elastomeric polyurethane (TPU) and layered silicate clay were prepared by in situ synthesis. The properties of nanocomposites of TPU with unmodified clay were compared with that of organically modified clay. The nanocomposites of the TPU and organomodified clay showed better dispersion and exhibited superior properties. Exfoliation of the clay layers was observed at low organoclay contents, whereas an intercalated morphology was observed at higher clay contents. As one of major purposes of this study, the effect of the silicate layers in the nanocomposites on the order-disorder transition temperature (T-ODT) of the TPU was evaluated from the intensity change of the hydrogen-bonded and free carbonyl stretching peaks and from the peak position change of the N-H bending peak. The presence of the organoclay increased TODT by approximately 10 degrees C, which indicated improved stability in the phase-separated domain structure. The layered silicate clay caused a tremendous improvement in the stiffness of the TPU; meanwhile, a reduction in the ultimate elongation was observed. (c) 2006 Wiley Periodicals, Inc.