This article reports way to functionalize hydroxyl-terminated polybutadiene (HTPB) backbone by sodium azide and ceric ammonium nitrate, resulting in the formation of novel azide-nitrato-HTPB. In order to optimization of the effective parameters on the synthesis of azide-nitrato-HTPB, the starting material concentration, reaction time and temperature were investigated and the effect of these parameters on the azido-nitrato functionalization of double bonds on HTPB backbone was evaluated. The functionalized HTPB by azidation (7.15%) and nitration (5.17%) showed viscosity of 17.6 Pa s(-1), number average molecular weight of 2980 g mol(-1) and hydroxyl value of 34 mg KOH per g.