This paper reports an experimental study on the modification of nafion membrane with neodymium triflate, Nd(SO(3)CF(3))(3), a rare earth triflate. The triflate ion resembles nafion in structure and has high lewis acidity, high coordination number, hygroscopic nature and thermal stability. These properties make the neodymium triflate (NdTfO) suitable to improve the performance of NdTfO/nafion membranes in direct alcohol fuel cell by reducing fuel permeability without compromising other properties. The NdTfO/nafion membranes reduced alcohol permeability by nearly 48%. The proton conductivity of 1% NdTfO/nafion was increased by at least 24% as compared to pure cast nafion membrane. The mechanical strength of 1% NdTfO/nafion was higher than that of pure cast nafion. The composite membrane was thermally and chemically stable and has potential for use in direct alcohol fuel cells. A DMFC was developed and its performance was evaluated using the composite membrane, which showed encouraging results. Copyright (C) 2011, Hydrogen Energy Publications, LLC. Published by Elsevier Ltd. All rights reserved.