This paper presents a groundbreaking study on the synergistic effect of combining Cloisite 30B (C30B) organoclay with styrene-butadiene-grafted glycidyl methacrylate (SbB-g-GMA), a dual-functional impact modifier and compatibilizer with the ultimate aim of developing high-performance materials based on polyethylene terephthalate (PET), and polystyrene (PS) with superior thermal and mechanical properties, thereby exploring the feasibility of recycling of these commonly used plastics via a simple melt blending approach. The morphology of the melt-mixed PET/PS blends and dispersion state of organoclay in the PET/PS/C30B nanocomposites in the presence and absence of the compatibilizer were analyzed by the X-ray diffraction, field emission scanning electron microscopy (FE-SEM), atomic force microscopy (AFM), and transmission electron microscopy (TEM). Furthermore, the thermal and mechanical properties of the nanocomposites were evaluated through TGA/DSC analysis and tensile and Izod impact tests. The microscopic images revealed that the addition of the SbB-g-GMA compatibilizer resulted in a superior dispersion of the nanoclay platelets. The composition of 70% PET, 30% PS, 7 phr SbB-g-GMA, and 3 phr C30B yielded the best dispersion of C30B and the most favorable thermomechanical properties in the PET/PS/SbB-g-GMA/C30B blend. Interestingly, the study found that using the nanoclay alone was insufficient to achieve compatibility between PET and PS. Optimal results were obtained when SbB-g-GMA was mixed into the PET/PS/C30B nanocomposite. The mechanical properties, including tensile and impact strength, modulus, elongation at break, as well as the thermal stability, exhibited significant improvements upon the addition of the synthesized SbB-g-GMA dual-functional compatibilizer compared to both the binary blends of PET/PS and the PET/PS/C30B nanocomposite.