The development and commercialization of nanoparticles such as nanoclays (NCs), carbon nanotubes (CNTs) and polyhedral oligomeric silsesquioxanes (POSS) offers new possibilities to tailor adhesives at the nanoscale. Four types of POSS, with reactive mono-functional groups of isocyanatopropyl, glycidoxypropyl, aminoethyl and non-reactive octaphenyl, were incorporated in concentrations of 1, 3 and 5 wt% into a polyurethane (PU)-based adhesive. Thermo-mechanical bulk properties were studied using dynamic mechanical analysis (DMA). Adhesive properties were characterized in shear and peel modes. Atomic force microscopy (AFM) was used to study the nanoscale morphology. DMA measurements indicated that the neat PU possessed a glass transition temperature (T-g) of approximate to 30 degrees C. The T-g of PU/POSS-glycidoxypropyl nanocomposite adhesive increased gradually with POSS concentration to 50 degrees C for 5 wt%. PU/POSS-octaphenyl nanocomposite adhesive exhibited an increased T-g by 10 degrees C for 5 wt%. The incorporation of POSS-isocyanatopropyl in the PU had no effect on the T-g.. With respect to shear properties of POSS-octaphenyl-, POSS-isocyanatopropyl- and POSS-glycidoxypropyl-based PU nanocomposite adhesives, shear strength improved by 230, 178 and 137%, respectively, compared to neat PU. POSS-aminoethyl exhibited lower shear and peel strengths, while POSS-isocyanatopropyl provided the best balance of both higher shear and peel strengths compared to neat PU. It was concluded that the grafted functional group on the POSS and its reactivity with the PU network components were the decisive factors with respect to the thermo-mechanical, morphological and adhesive properties of the resulting nanocomposite adhesives. Consequently, the POSS/polyurethane based nanocomposite adhesives could be tailored for a large range of applications.