Nanocomposites were synthesized using unsaturated polyester as the matrix and organically modified montmorillonite (CA-MMT) as the reinforcing agent. XRD pattern of the modified montmorillonite showed that the interlayer spacing expanded from 1.21 to 1.9 nm, indicating intercalation. TGA and DTA show loss of organic surfactant from interlayer galleries. Glass transition temperature (T g) of these composites increased from 71 °C in the unfilled unsaturated polyester to 79 °C in the composites with 5 % organically modified montmorillonite. Chemical resistance and mechanical properties of the UP/organo-clay nanocomposites were studied. Chemical resistance was studied under aqueous conditions in acetic acid, nitric acid, hydrochloric acid, sodium hydroxide, aqueous ammonia and sodium carbonate. Chemical resistance studies reveal maximum weight gain/loss with increasing clay content. Mechanical studies show maximum characteristics for the composites-clay filled 5 % (w/w).