: Recently,usage of biodegradable polymers instead of common petroleum polymers has been grown. Starch is considered as the most capable biopolymer for the production of biodegradable plastics because of its immense potential and low priceto use in nonfood industries. However, starch has issues like weak mechanical properties and low moisture resistance. To improve these problems,starch can be blended with superiorpolymers or reinforced materials.Poly vinyl alcohol (PVA) is a polymer with appropriate mechanical and optical properties which can be a good candidate for blending with starch. The main purpose of this research is to produce and characterize PVA/starch nano-biocomposite reinforced with cellulose nanofibers (CNF) extracted from aspen wood sawdust as an inexpensive and unusable waste source. To extract cellulose nanofibers from sawdust a chemo-mechanical method was used.Chemical treatment causes to remove lignin, hemicelluloses, and pectin from cellulose structure and then mechanical treatment disintegratescellulose micro fibers to nanofibers. In chemical stage, first, sawdust extraction was exhausted with ethanol for 6 hours in a soxhlet extractor, and then bleached with 3% hydrogen peroxide solution to remove some of insoluble lignin. Afterward, acidic hydrolyze with hydrochloric acid, alkali treatment with dilute sodium hydroxide, and bleaching with sodium chlorite were carried out to eliminate hemicellulose, pectin, soluble lignin, and insoluble lignin. After the chemical stages, the final isolation of cellulose nanofibers was executed with a super grinder. Chemical characterization of fiber was performed with a modified TAPPI standard test on raw material and chemically treated fibers and concluded that cellulose content was increased from 49.9% to 79.1% that indicate appropriate elimination of non-cellulosic substances. In addition, FTIR characterization on untreated and chemically treated fibers showed that hemicellulose and lignin were removed and lateral Order Index which is an indication of crystallinity of fiber was increased from 0.893 to 1.201. SEM images also showed that the average diameter of isolated nanofibers is 74 nanometers. The next stage of this research is preparation of PVA/starch composites with extracted cellulose nanofiber as the reinforcement phase (3, 5, 7 10 wt%), glycerol as the plasticizer and borax as the crosslinking agent applying solution casting method. Mechanical properties of composites were investigated and showed 24% increase in tensile strength (5% cellulose nanofibers). In addition, Young’s modulus was increased from 12 to 27 MPa. SEM images of fracture surface of composites demonstrated suitable dispersion of nanofibers in matrix. Also, moisture absorption of composite reinforced by 5% CNF was reduced from 54.3% to 41%. Dissolution of nanocomposite include 5% CNF in water was also decreased by 62% compare to pure PVA/Starch sample. Finally, traarency test of samples with spectrophotometer indicated that increasing cellulose nanofiber content of composites causes to reduce traarency of films. Key words: Cellulose Nanofiber, Sawdust, Aspen Wood, Nanocomposite, PVA, Starch