Carbon nanotubes were used to modify a polyacrylonitrile (PAN) polymer solution before the manufacture of the carbon fiber precursor. The modified PAN fibers were spun from a dimethylformamide solution containing a small amount of single-walled carbon nanotubes. The fibers were characterized by thermogravimetry and optical and scanning electron microscopy. Structure, morphology, and selected properties of the composite polymeric fibers and the fibers after carbonization are characterized. The mechanical properties of the fibers are examined. It is found that nanotubes in the PAN solution have a strong tendency to form agglomerates that inhibit suitable macromolecular chain orientation of the carbon fiber precursor. Fibers manufactured from such a solution have similar mechanical properties to those from a pure PAN precursor, and after carbonization the resultant carbon fibers are very weak. A comparison of pure carbon fibers and those containing nanotubes reveals slight differences in their structural ordering.