Polyhydroxybutyrate (PHB) is a thermoplastic, biodegradable, linear, and semicrystalline polyester synthesized by bacteria; while coir dust, a waste generated during the coconut fiber processing, is a mixture of short fibers and powder. The aim of this work was to prepare and characterize composites based on a biopolymer and biowaste, so that the products were derived from natural renewable resources. The composites were produced by compression molding. Composite properties were evaluated by scanning electron microscopy, low field nuclear magnetic resonance, X-ray diffraction, differential scanning calorimetry, thermogravimetric analysis, and tensile tests. The best results were obtained for the composite containing 10 wt% coir dust, which presented improvements of 35% in tensile strength and 25% in elongation at break when compared with unfilled PHB. The dispersion of higher contents of filler was inefficient resulting in agglomeration and consequently, in premature failure. Despite hydrophilic nature of the coir dust, some degree of interaction between filler and polymeric matrix occurred. It was suggested that coir dust plays two simultaneous roles in the composite. Initially, the filler surface would favor crystal formation acting as a nucleating agent, and at the same time, chain movements would be progressively hindered inhibiting crystal growth. POLYM. ENG. SCI., 50:1466-1475, 2010. (C) 2010 Society of Plastics Engineers