The goal of this study was to fibrillate cellulose from micro to nano scale and evaluate how these microfibers and nanofibrils affected the mechanical and thermal properties of thermoplastic polyurethane. The source of cellulosic material was hard wood cellulose fibers and the fibrillation was done with a high pressure homogenizer. The composite materials were prepared using compression moulding, by stacking the cellulose fiber mats between polyurethane films. The results showed that both microfibers and nanofibrils reinforced the polyurethane and provided better heat stability. The addition of 16.5 wt% of cellulose nanofibrils to PU increased the strength nearly 500% and the stiffness by 3000%. These results are very promising in terms of obtaining fibrils with a novel processing method and by improving the mechanical and thermal properties of polyurethane. This is expected to expand the application areas of polyurethanes. (c) 2007 Elsevier Ltd. All rights reserved.