The morphology and properties of nylon6/HDPE blends without and with nanoclay has been reported. Scanning electron microscopy study of the (70/30 w/w) nylon6/HDPE blends with small amount (0.1 phr) of nanoclay indicated a reduction in the average domain sizes (D) of dispersed HDPE phase and hence better extent of mixing compared to the blend without any nanoclay. X-ray diffraction study and transmission electron microscopy revealed that nanoclay layers were mostly located in nylon6 matrix of the (70/30 w/w) nylon6/HDPE blend. However, the same effect of nanoclay on the morphology was not observed in (30/70 w/w) nylon6/HDPE blend where HDPE became the matrix. In (30/70 w/w) nylon6/HDPE blend, addition of nanoclay increased the D of dispersed nylon6 domains by preferential location of the clays in side the nylon6 domains. Thus, the clay platelets in the matrix phase acted as barrier that restricted the coalescence of dispersed domains during melt-mixing. Addition of PE-g-MA in both the compositions of nylon6/HDPE blend effectively reduced the D of dispersed phases. Storage modulus and thermal stability of the blend were improved in presence of small amount of clay, whereas addition of PE-g-MA lowered the mechanical and thermal properties of the blends. (C) 2011 Wiley Periodicals, Inc. J Appl Polym Sci 121: 359-368, 2011