Few-layered graphene oxide is covalently functionalized with (3-Aminopropyl) triethoxysilane and incorporated into an organosiloxane matrix using a sol-gel technique. Nonlinear optical and optical limiting properties of functionalized few layered graphene oxide embedded in an organosiloxane matrix (f-GO/sol) are studied in the nanosecond regime at 527 nm. In a Z-scan study, f-GO/sol samples exhibit superior nonlinear optical and optical limiting responses in comparison to their graphene oxide precursor due to increased covalent crosslinking of graphene oxide and organosiloxane molecules. These significant improvements are attributed to the combined mechanisms of nonlinear absorption and nonlinear scattering, due to graphene-silica nanostructures and thermally-generated microplasmas.