This work is focused on the modification of montmorillonite by hexadecyl trimethyl ammonium bromide (HDTMA) as a surfactant by cation exchange reaction. HDTMA-modified layered silicate (HDTMA-MLS) was compounded with polylactide (PLA) by melt extrusion technique for making nanocomposites. These nanocomposites were subjected to morphological, rheological, thermal and mechanical analyses. Variations in mechanical properties, plasticity and thermal stability with the addition of modified nanoclays in PLA were investigated. The presence of HDTMA in clay minerals was confirmed by Fourier-transform infrared (FTIR) analysis that shows two absorption bands at 2927 cm^-1 and 2860 cm^-1 that corresponds to the asymmetric and symmetric stretching vibrations of C–CH₂ of alkyl chain, respectively, and the band at about 1470 cm^-1 was assigned to the vibration of trimethyl ammonium quaternary group C–N(CH₃)₃. Melt rheology of virgin PLA and nanocomposites performed by small amplitude oscillation shear measurement. Incorporation of HDTMA-MLS (1–7 wt%) into PLA matrix yields significant improvements in the elastic modulus (G') of nanocomposites due to intercalation at high temperature. X-Ray diffraction (XRD) and transmission electron microscopy determined that PLA/HDTMA-MLS nanocomposites were intercalated. Nanocomposite prepared using 5 wt% HDTMA-MLS exhibited optimum mechanical performance with an increase in the tensile and flexural modulus and impact strength as compared to virgin PLA, which confirms intercalation morphology. Dynamic mechanical analysis study revealed an increase in the storage modulus (G') confirming a strong interaction between the modified clays and PLA. Differential scanning calorimetry and thermogravimetric analysis showed improved thermal properties. Heat deflection temperature of the matrix also increases in the presence of nanoclays.