Poly(ethylene terephthalate) (PET)/montmorillonite (MMT) nanocomposites were prepared by solution intercalation method. The clay was organo-modified with the intercalation agent cetylpyridinium chloride (CPC). Wide-angle X-ray diffraction (XRD) showed that the layers of MMT were intercalated by CPC. Four nanocomposites with organoclay contents of 1, 5, 10, and 15 wt % were prepared by solution blending. XRD showed that the interlayer spacing of organoclay in the nanocomposites depends on the amount of organoclay present. According to the results of differential scanning calorimetry (DSC) analysis, clay behaves as a nucleating agent and enhances the crystallization rate of PET. The maximum enhancement of crystallization rate for the nanocomposites was observed in those containing about 10 wt % organoclay within the studied range of 1-15 wt %. From thermogravimetric analysis (TGA), we found that the thermal stability of the nanocomposites was enhanced by the addition of 1-15 wt % organoclay. These nanocomposites showed high levels of dispersion without agglomeration of particles at low organoclay content (5 wt %). An agglomerated structure did form in the PET matrix at 15 wt % organoclay. (C) 2003 Wiley Periodicals, Inc.