Fibrous cellulose (fibrous W400) was substantially dried and mechanically milled with stearic acid under several conditions. Milled with 2 wt% stearic acid at a rotational speed of 200 rpm for 24 h, fibrous W400 were pulverized into fine flake-shaped particles (flake-shaped W400) with an average particle size of ca. 10 μm. Composites of the flake-shaped W400 and olefinic thermoplastic elastomer (TPV) were prepared under melt mixing and passed through an open roll to orient the particles. The tensile properties of the composites without any compatibilizer were deteriorated with increasing content of the particles. However, the tensile modulus and hardness of the composites prepared by the addition of a compatibilizer (CA-60) were increased with increasing content of particles, because of the strong adhesion between flake-shaped W400 and TPV. The damping properties of the composites were improved in comparison with TPV. © 2004 Wiley Periodicals, Inc.