Biodegradable poly(epsilon-caprolactone) (PCL) and octavinyl-polyhedral oligomeric silsesquioxanes (ovi-POSS) nanocomposites were prepared at low ovi-POSS loadings via a solution casting method in this work. Scanning electron microscopy observation reveals not only the fine dispersion but also the crystallization of ovi-POSS in the PCL matrix. The overall isothermal melt crystallization kinetics, spherulitic morphology, crystal structure, and dynamic mechanical properties of neat PCL and its nanocomposites were studied with various techniques. The presence of ovi-POSS has enhanced the overall isothermal melt crystallization rates of PCL in the nanocomposites; however, the crystallization mechanism and crystal structure of PCL remain unchanged despite the ovi-POSS loading. In addition, the storage modulus of the nanocomposites has been enhanced significantly relative to neat PCL, while the glass transition temperature varies slightly irrespective of the presence of ovi-POSS.