The potential of agricultural waste residues, such as sugarcane bagasse, as natural fiber reinforcement in thermoplastic biocomposites, is of significant interest. This study investigates the physical and mechanical behavior of PLA and HDPE composites reinforced with chemically modified sugarcane bagasse fibers. The fibers underwent alkali treatment with sodium hydroxide, silane treatment with 3-glycidoxypropyltrimethoxy silane and acid treatment with oxalic acid. Density and void percentage variations in the composites were assessed to determine the effects of the modifications, revealing that silane-treated samples of both thermoplastics had the lowest void content, indicating better compatibility between the fibers and the matrix. Mechanical tests, including impact, hardness, flexural and tensile properties, were conducted on various composites, and it was observed that chemical treatments enhanced the mechanical properties of the reinforced samples. The morphology of the composite fractured surfaces was assessed using scanning electron microscopy, revealing that chemical treatments significantly affect the failure modes of the composites. Moreover, the thermal response of the composites was characterized using thermogravimetric analysis and differential scanning calorimetry. The maximum thermal degradation temperatures, glass transition temperature, melting temperature, weight loss rate, melting enthalpy and activation energies were reported. Additionally, wettability studies and moisture absorption tests were performed. Results indicated that unreinforced composite samples had the lowest moisture absorption, while contact angle measurements demonstrated that different chemical treatments impart varied hydrophobicity and water barrier properties to the composites.