Among biobased and biodegradable polymers, polylactic acid (PLA) is most widely used one. However, its poor mechanical properties need to be enhanced. In this study, PLA blend film with improved mechanical properties were developed without compromising any bio-content. For this, natural rubber derivative with acetate pendant group (ANR) and PLA blend films were prepared. First, natural rubber was epoxidized, and then partial acetylation was achieved by the ring-opening reaction of the epoxy groups. The epoxidation and the acetylation were examined by FTIR analysis. 1H-NMR spectrum revealed a 29% epoxidation and 8.25% acetylation degree. The Tg of natural rubber (−66°C) increased to −41°C and −31°C after epoxidation and acetylation, respectively. The compatibility of ENR and ANR with PLA was evident from the DSC results and Molau test. The morphology of PLA blend film containing 25 wt% of ANR (ANR25) was observed as well-dispersed fine droplets by SEM images. The tensile strength, elastic modulus, and yield strength of ANR25 were measured as 11.6 MPa, 397.3 MPa, and 6.9 MPa, respectively. These values are considerably higher than neat PLA film. Compared to reported studies on PLA toughening so far, increments in both the strength and elongation of ANR25 were observed by tensile tests. Moreover, highest toughness among all samples was determined as 18.8 MJm−3 for ANR25, which is 1.8 times higher than neat PLA. Thus, a strong and tough bio-based PLA blend was developed for film application such as packaging and sheeting.