Epoxy resin (EP)/polyhedral oligomeric silsesquioxanes (POSS) hybrids were prepared based on diglycidyl ether of bisphenol-A and octapropylglycidylether POSS (OGPOSS). The morphology of EP/OGPOSS hybrids was characterized by scanning electron microscopy. Differential scanning calorimetry and dynamic mechanical analysis indicated that the glass transition temperature (T-g) of the hybrids decreased with the increase of OGPOSS content. This phenomenon was ascribed to the increased free volume with the addition of bulky OGPOSS. Additionally, thermogravimetric analysis indicated that all the epoxy hybrids displayed similar degradation profiles, suggesting that OGPOSS did not change the mechanism of EP. The incorporation of OGPOSS into EP matrix produced high char yields at high temperatures, suggesting improved flame retardancy. Microscale combustion colorimeter tests showed that incorporation of OGPOSS into epoxy thermosets could significantly improve the flame retardancy. The increasing OGPOSS content into EP matrix exhibited a decreasing trend in the values of dielectric constant compared with those of neat EP.