The objective of this research was to fabricate a novel nanoclay masterbatch containing polymer‐intercalated in nanoclay with comparable degree of interlayer expansion, flowability, and high thermal stability. It is ready to use for preparing polymer/clay nanocomposites by melt extrusion. The nanoclay masterbatch was efficiently prepared in one‐step via a new approach called nanoclay gel. The nanoclay gels were successfully prepared at different original nanoclay concentrations ranging from low to high clay loading (10%, 20%, and 30% w/v) in cooperation with polyethylene glycol (PEG) at various PEG loadings (weight ratios of nanoclay/PEG 1/1, ½, and 1/3) and kappa carrageenan (KC), a thermolytic hydrogel at a fixed minimum concentration. X‐ray diffraction (XRD) results revealed that the intercalation of PEG molecules expanded silicate basal spacing up to 17–18 A° even at high percentage of nanoclay (dry content about 24–49 wt%). Scanning electron microscope (SEM) revealed the denser packing of clay layers in accordance to an increase in density of the dry nanoclay gel with increment of original nanoclay loadings. An increase of PEG content exhibited better flow ability as seen by increasing melt flow index. Thermal decomposition of the nanoclay gels was up to 380°C; by using the dry nanoclay gels to prepare polystyrene (PS)/clay nanocomposites via melt extrusion. The morphological results showed that the exfoliated structures were achieved. The mechanical and thermal stability properties were significantly enhanced. The appearing color of PS/clay nanocomposites prepared from nanoclay gel was bright pale‐yellow without evidence of thermal degradation. POLYM. COMPOS., 40:2751–2767, 2019. © 2018 Society of Plastics Engineers