High molar mass medium density polyethylene (MDPE) compounds containing magnesium hydroxide filler, surface-treated by a range of fatty acid coatings of variable aliphatic chain length were injection molded and subjected to mechanical property evaluation. Surface treatment modifies yield stress and modulus, with property maxima observed close to the monolayer coverage. Acid-group terminated polyethylene (ATPE) coatings produced the highest yield stress, as a result of physical interaction with the matrix polymer. Retention of high-energy, ductile mode impact failure of unfilled MDPE was obtained when using short-chain decanoic acid coating, as a result of enhanced dispersion and reduced particle-matrix interactions promoting microscopic matrix yielding. A mechanism for enhanced Mg(OH)(2) particle dispersion based upon surface energy and molecular adsorption has been proposed, which is consistent with the properties data derived. Fractographic analysis (SEM) has confirmed the predominance of matrix yielding in compounds exhibiting enhanced impact resistance, while X-ray photoelectron spectroscopy (XPS) has also highlighted a different crack growth mechanism in MDPE compounds containing coated fillers, which are less prone to agglomeration. In addition, thermomechanical history during processing also modifies physical properties of MDPE/Mg(OH)(2) composites to some extent. Anisotropic effects include molecular orientation and filler particle alignment induced by shear stress during injection mold filling, which predominate in compounds containing coated fillers. Overall, the application of organo-acid coatings reduces polymer-particle surface interaction and thermodynamic work of adhesion, leading to improved dispersion and enhanced properties. Appropriate property balances can be tailored by judicious selection of aliphatic chain length and addition level of fatty acid filler coatings.