Starch is a kind of low-costly renewable and biodegradable polymer and has been applied in academic research and industry for the past few decades. Native starches are widely used in food industry as thickener, colloidal stabilizer, gelling agent, bulking agent and water retention agent. However, limitations such as low shear resistance, thermal resistance, thermal decomposition and high tendency towards retrogradation limit its use in some industrial food applications. Therefore, most native starches employed in practical food applications are required to be modified to improve their functional properties. Starch modification, which involves the alteration of the physical and chemical characteristics of the native starch to improve its functional characteristics, can be used to tailor starch to specific food applications. Starch octenyle succinate, is produced by the reaction of starch with octenyle succinic anhydride( OSA). In this research, sago starch was modified with octenyle succinic anhydride then its physicochemical characteristics and functional properties were investigated. After that film from modified starch was preapared. To improve properties of film, calcium chloride and ferulic acid was added to the solution of OSA starch film and the properties of film from native starch, OSA starch, OSA starch with calcium chloride and OSA starch with ferulic acid were investigated. The degree of substitution (DS) of OSA starch was determined by titration method. In this study, the DS value was obtained 0.013 that is in accordance with the amount of allowed by FDA (DS? 0.02). The resultant OSA starch was characterized by using fourier transformation infrared (FTIR) spectroscopy, x-ray diffraction (XRD), scanning electron microscopy (SEM). The results of XRD spectra indicated that reaction of sago starch with OSA in aqueous suspension causes semi-crystalline structure of starch become more amorphous. The SEM images, showed, the structure of starch granules destroyed with chemical modification. Functional properties of native starch and modified starch such as water absorption, solubility in water, emulsifying activity of starch and clarity of starch gel has been investigated. The results of these tests showed that chemical modification with OSA causes improving functional properties. Modification of starch with OSA increased the solubility in water, water absorption, water vapor permeability, elongation at break, transeparency and contact angle of starch film. Adding calcium chloride and ferulic acid to solution of OSA starch film decreased the water absorption and water vapor permeability. Keywords : Starch, Sago starch, Octenyle succinic anhydride, Biodegradable film, Calciume chloride, Ferulic acid