Lignin nanoparticles (nanolignin, NL) were prepared in this work by ultrasonic treatment of softwood kraft lignin to obtain lignin‐water dispersions with excellent colloidal stability. A thorough characterization of the chemical, physical, and morphological properties of the new NL particles allowed for direct comparisons with the untreated parent material. Such NL particles were incorporated into a waterborne thermoplastic polyurethane matrix at different concentrations to yield bio‐based nanocomposite materials. The effect of the bio‐filler type (NL vs. untreated lignin) and loading on the chemical, physical, thermal, and morphological characteristics of the resulting nanocomposites was extensively investigated. In addition, tensile tests carried out on these systems highlighted the superior mechanical properties of NL‐based nanocomposites compared to composite materials incorporating untreated lignin. The results of this study provide a direct demonstration of an easy and environmentally friendly approach to obtain waterborne polyurethane‐based nanocomposites reinforced with NL in a relatively straightforward and accessible way and clearly evidence the potential of lignin nanoparticles as fully bioderived fillers for advanced nanocomposite applications. © 2017 Wiley Periodicals, Inc. J. Appl. Polym. Sci. 2017, 134, 45318.