A new type of phenolic resin nano-composite, with excellent impact strength, flexural strength and heat resistance, is introduced in this paper. The phenolic resin is modified with organic elastomeric nanoparticles including nitrile butadiene and carboxylic nitrile butadiene rubbers. TEM images show that the elastomeric nanoparticles are uniformly dispersed in phenolic matrix with a diameter of about 100 nm. SEM photographs show that large quantity of microcracks, initiated by nanoparticles, exist on fracture surface. These microcracks can dissipate impact energy and improve the impact property of phenolic composite. FTIR analysis and curing reaction kinetics analysis confirm that the excellent thermal property is due to the existence of special interface between nanoparticles and phenolic matrix. (c) 2005 Elsevier Ltd. All rights reserved.