Eco-friendly bio-nanocomposite films based on polyvinyl alcohol/chitosan (PVA/CS), reinforced with cellulose nanocrystals (CNC) were prepared by solution casting method. The CNC was successfully isolated from agriculture waste; rice straw (RS) by acid hydrolysis method and characterized with respect to their morphology, size, and thermal stability. The isolated CNC exhibited a rod-like structure with particle size around 15 nm in diameter. Subsequently, the PVA/CS films reinforced with various concentrations (1, 3, and 5 wt%) of CNC were assessed for their morphological features, thermal and mechanical properties. It was noted that the addition of RS-CNC increased the tensile strength (98.15 MPa) and thermal stability of the PVA/CS films. The bio-nanocomposites sustained similar transparency level of the PVA/CS blend film suggesting that the CNC were dispersed at the nanoscale range. The PVA/CS/CNC bio-nanocomposite film also exhibited good antifungal and antibacterial activity. Therefore, the present study suggests that the eco-friendly bio-nanocomposite film have great potential in food packaging applications. (C) 2018 Elsevier B.V. All rights reserved.