The poly(hydroxy ether of bisphenol A) (phenoxy (Ph)) has been revealed as a polymeric matrix able to intercalate in, and partially exfoliate a commercial organically modified montmorillonite. Dispersion was attributed to chemical interactions between the Ph and the inorganic clay. A significant increase in the modulus of elasticity (33% with 3.8% montmorillonite (MMT) addition) was observed, together with an unusual increase in ductility attributed to surfactant migration, that should allow tailoring of the processing conditions to widen exfoliation. Ph-based nanocomposites could be used as a nanostructured masterbatch for producing new polymer nanocomposites by mixing the masterbatch with the polymeric matrices that either miscibilize or are compatible with Ph. (c) 2006 Society of Chemical Industry.