Halloysite nanotubes (HNTs) based thin membrane-like fully biodegradable nanocomposites were produced by blending individualized HNT dispersion with polyvinyl alcohol (PVA). Stable individualized HNT dispersion was obtained using several separation techniques, sequentially, prior to blending with PVA. PVA was crosslinked using malonic acid (MA) as crosslinker and phosphoric acid as catalyst, to increase the mechanical and thermal properties of HNT-PVA nanocomposites. Crosslinking was also intended to make PVA water-insoluble and hence more useful in commercial applications. Examination of the composites indicated that HNTs were uniformly dispersed in both PVA as well as crosslinked PVA. Excellent mechanical properties of the HNT-PVA nanocomposites were achieved. These nanocomposites are intended to be composted at the end of their life rather than ending up in landfills as most of today's traditional petroleum based non-biodegradable plastics.