This article presents the effects of coupling agent and nanoclay (NC) on some properties of wood flour/polypropylene composites. The composites with different NC and maleic anhydride grafted polypropylene (MAPP)contents were fabricated by melt compounding in a twin-screw extruder and then by injection molding. The mass ratio of the wood flour to polymer was 40/60 (w/w). Results showed that applying MAPP on the surface of the wood flour can promote filler polymer interaction, which, in turn, would improve mechanical properties of the composite as well as its water uptake and thermal stability. Composite voids and the lumens of the fibers were filled with NC, which prevented the penetration of water by the capillary action into the deeper parts of composite. Therefore, the water absorption in composites fabricated using NC was significantly reduced. Scanning electron microscopy has shown that the treatment of composites with 5 wt% MAPP, promotes better fiber–matrix interaction, resulting in a few numbers of pull-out traces. In all cases, the degradation temperatures shifted to higher values after using MAPP. The largest improvement on the thermal stability of composites was achieved when NC was added.