Polyaniline (PANi)-grafted multiwalled carbon nanotube (MWNT) composite is prepared by a two-step reaction sequence. MWNT is first functionalized with 4-aminobenzoic acid in polyphosphoric acid/phosphorous pentoxide as a "direct" Friedel-Crafts acylation reaction medium. The resultant 4-aminobenzoyl-functionalized MWNT is then treated with aniline using ammonium persulfate/aqueous hydrochloric acid to promote a chemical oxidative polymerization, leading to PANi-grafted MWNT composite. The resultant composite is characterized by elemental analysis, Fourier-transform infrared spectroscopy, wide-angle X-ray diffraction, scanning electron microscopy, transmission electron microscopy, thermogravimetric analysis, UV-vis absorption spectroscopy, fluorescence spectroscopy, cyclic voltammetry, and electrical conductivity measurement. The thermooxidative stability and electrical conductivity of PANi-grafted MWNT composite are improved compared to those of PANi. Specifically, the electrical conductivity of PANi-grafted MWNT is improved 10900 times depending upon the level of doping. The capacitance of the composite is also greatly enhanced. (C) 2010 Wiley Periodicals, Inc. J Polym Sci Part A: Polym Chem 48: 3103-3112, 2010