Clay aerogel composites have high potential to be used in the construction industry as an insulation material; however, their hydrophilic nature may result in an amount of moisture absorption that could significantly hinder both physical and mechanical properties. This study develops hydrophobic clay aerogel composites using an environmentally friendly freeze-drying process. This was achieved by using three water dispersible repellent components: WDisRep1, WDisRep3, and WDisRep4. Microstructure, wettability, moisture resistance, mechanical properties, and thermal conductivity of the developed clay aerogel composites were fully characterized to performance. The composites exhibited superior mechanical and physical propertiesunderstand working mechanisms and in which the composites' moisture absorbance was reduced by up to 40%, while maintaining excellent dimensional stability. The aerogel composites achieved a contact angle of 140 with a 93% reduction in water absorption. The composites achieved a compressive modulus as high as 3.2 MPa while maintaining low thermal conductivity at 0.038 W/(m K).