A fully exfoliated organoclay in thermotropic liquid crystalline polymer (TLCP) based nanocomposite was prepared by a method combining ultrasonication, centrifugation, solution casting, and heat-shearing separation. Morphological study showed that the organoclays of 15-25 nm in size dispersed uniformly in TLCP with fully exfoliated structures. The organoclays formed molecular level interactions with TLCP molecules. The interactions did not affect the liquid crystallinity and mesophase structure of TLCP, but they affected the thermal stability and thermal properties of TLCP, increasing the thermal stability and shifting the transition temperatures to the higher ends. Mechanical rheology investigations in the linear viscoelastic region showed that with the exfoliated organoclay in TLCP, more obvious pseudosolidlike behavior appeared in the terminal region. The rigidity of TLCP was enhanced by the presence of the exfoliated organoclay with percolated structures in the TLCP matrix. In steady shear tests, the nanocomposite had the similar shear viscosity and N1 (the first normal stress difference) to those of TLCP in the steady state condition. Percolated structures were easily destroyed by sufficient shear strain and the exfoliated organoclays were oriented along the shear direction, even assisting the neighboring TLCP molecules to align in the flow direction, resulting in a decrease of viscosity and an increase of the N1 slope. (C) 2010 Wiley Periodicals, Inc. J Polym Sci Part B: Polym Phys 48: 712-720, 2010