Graft copolymer nanocomposites based on cashew gum and poly(acrylamide) with different concentrations of nano‐iron‐oxide particles (Fe3O4) have been prepared by an in situ polymerization method. The characterization of graft copolymer composite was carried out by FTIR, UV, XRD, SEM, DSC, and TGA, electrical conductivity, and magnetic property [vibrational sample magnetometer (VSM)] measurements. The shift in the spectrum of UV and FTIR peaks shows the intermolecular interaction between metal oxide nanoparticles and the graft copolymer system. The spherically shaped particles observed from the SEM images clearly indicating the uniform dispersion of nanoparticles within the graft copolymer chain. The XRD studies revealed that the amorphous nature of the graft copolymer decreases by the addition of Fe3O4 nanoparticles. The glass transition temperature studied from DSC increases with increase in concentration of metal oxide nanoparticles. Thermal stability of composite was higher than the pure graft copolymer and thermal stability increases with increase in content of nanoparticles. Electrical properties such as AC conductivity and dielectric properties of the composites increased with increase in concentration of metal oxide nanoparticles. The magnetic property of graft copolymer nanocomposites shows ferromagnetic and supermagnetism and the saturation of magnetism linearly increased with increasing the Fe3O4 content in the polymer composite. © 2016 Wiley Periodicals, Inc. J. Appl. Polym. Sci. 2016, 133, 43496.