BACKGROUND The limitation on output power is a great challenge for the practical application of sediment microbial fuel cells (SMFC). One of the effective strategies to overcome this problem is to develop better‐performing cathodes. RESULTS Polyaniline (PANI)‐graphene nanosheets (GNS) modified cathodes were fabricated and applied as the cathodes of SMFCs to improve their electricity generation capacity. PANI‐GNS cathodes were fabricated through situ‐polymerization of aniline in a solution containing homogeneously dispersed GNS. The mass ratio between aniline and GNS in the polymerized solution was the key factor controlling the properties of the modified cathode and the optimum ratio was 9:1. Because of the outstanding electrical conductivity of GNS, PANI‐GNS cathodes outperform the control (blank) and PANI cathodes. The PANI‐GNS0.1‐SMFC exhibited the highest output voltage of 640 mV, 5 times that of the blank SMFC; the maximum power density was improved from 0.85 mW m‐2 with the blank SMFC to 99 mW m‐2 of the optimal PANI‐GNS0.1‐SMFC. CONCLUSIONS This study provides a simple electrode modifying method to enable an as‐synthesized PANI‐GNS cathode to dramatically promote the performance of an SMFC. © 2013 Society of Chemical Industry