Abstract: Epoxy resin-montmorillonite nanocomposite, which is cured by methyl tetra-hydrogen anhydride, is prepared, in which montmorillonite is modified by polyhydroxyl long-chain alkyl quaternary ammonium salts. The microstructure and properties are characterized by means of TEM, SEM, TGA and DMA. The results of TEM show that epoxy resin-organic montmorillonite nanocomposite, with nanometer scale layered montmorillonite, has been formed. Epoxy resin with 3 wt% organic montmorillonite is toughened and strengthened, the resistance to impact of composite is improved by 87.8 %, and the tensile strength of composites is enhanced by 20.9 %. Additionally, the nanometer scale layered montmorillonite in epoxy matrix ameliorates thermal stability and dynamic mechanics properties. With 5 wt% organic montmorillonite, the heat distortion temperature increases by 8.7℃, and the thermal decomposition temperature also increases by 14.7℃. And when the temperature is less than T_g, the storage modulus of composites is heightened by 42.86%; when the temperature is greater than T_g, the storage modulus of composites is heightened by 229.8%. And the T_g is also improved by 14.7℃.