PET/silicate nanocomposites were prepared using a reactive compatibilization method. Two different compatibilizer with end-functional moieties were used; one with only one hydroxyl group at a chain end and the other with one hydroxyl group at one chain end and several epoxy groups at another end. The second compatibilzer was effective in exfoliating stearyl amine treated montmorillonite, indicating that the existence of epoxy is critical for our purpose. The chemical reaction between PET and the reactive compatibilizer was characterized using a Fourier transform infrared spectroscopy and proved to take place during melt mixing. However, the reaction was not controlled in an optimum manner due to the excess epoxy content in the compatibilizer. It caused chain scission and crosslinking of PET and the resultant PET nanocomposites were very brittle.