A review on the preparation, characterization, materials properties, crystallization behavior, melt rheology, and processing of biodegradable polymer/layered silicate nanocomposites, which are the most widely interest in materials science research today, is given in this article both in terms of academic and industrial aspects. Montmorillonite and hectorite are among the most commonly used smectites type layered silicates for the preparation of nanocomposites. In their pristine form they are hydrophilic in nature and this property makes them very difficult to dispersed into a polymer matrix. The most common way to remove this difficulty by replacing interlayer cations by some quaternizedammonium or phosphonium cations preferably with long alkyl chain. The whole range of biodegradable polymer matrices is covered. This new family of composite materials frequently exhibits remarkable improvements of material properties when compared with virgin polymers. Improvements can include high storage modulus both in solid and melt states, increased tensile and flexural properties, decrease in gas permeability, increased heat distortion temperature and thermal stability, and increase in rate of biodegradability.