In the present study, naturally occurring unfractionated bentonite clay was used to prepare styrene butadiene rubber/bentonite clay nanocomposite by latex stage blending. The bentonite clay was organo-modified by in situ resol formation by the reaction of resorcinol and formaldehyde. The latex clay mixture was co-coagulated with acid. The resulting clay masterbatch was compounded and evaluated by Fourier Transform Infrared spectroscopy, X-ray diffraction (XRD), Transmission Electron Microscopy (TEM), Energy Dispersive X-ray spectroscopy (EDS), Scanning Electron Microscopy, Thermogravimetric analysis, and Differential Scanning Calorimetry. XRD showed that the interplanar distance of the in situ resol-modified bentonite clay increased from 1.23 to 1.41 nm for the unmodified bentonite. TEM analysis indicated partial exfoliation and/or intercalation. EDS (Si and A[ mapping) of the clay revealed the nature of the dispersion in the nanocomposites vis-A-vis the conventional styrene-butadiene rubber (SBR)/bentonite clay composite. Thermogravimetric analysis was used to compare the decomposition trends of the SBR/clay nanocomposites with the SBR/clay composite. The glass transition temperature of SBR/clay nanocomposites increased as compared with that of neat SBR. Substantial improvement in most of the other mechanical properties was also observed in case of the nanocomposites. POLYM. ENG. SCL, 49:1279-1290, 2009. (C) 2009 Society of Plastics Engineers