Basalt fiber reinforced polypropylene composites with two initial fiber lengths (3.2 and 6.4 mm) were fabricated using twin‐screw extrusion compounding. In the case of composites with smaller initial fiber length, basalt fibers predominantly served as nucleating agents for polypropylene thereby resulting in an increase in the degree of crystallinity. The addition of polypropylene‐g‐maleic anhydride (PP‐g‐MA) caused the matrix to become amorphous, which was due to the establishment of a fiber–matrix interphase. This behavior was different for the composites with relatively larger initial fiber length especially at higher fiber content. The reduction in fiber length in the composites caused a decrease in crystallinity, as this hindered the ability of the polypropylene matrix to form crystals. Addition of PP‐g‐MA established a fiber–matrix interphase thereby synergistically contributing to the increased matrix amorphousness of the basalt fiber reinforced polypropylene composites with 6.4 mm initial fiber length. Reduced fiber length due to processing also accelerated the thermal degradation of the composites with an initial fiber length of 6.4 mm. However, the reduction in fiber length due to processing resulted in increased fiber orientation, which contributed to the improvement in tensile and flexural properties of the basalt fiber reinforced polypropylene composites with an initial fiber length of 6.4 mm. At 30% fiber content, the tensile strength and modulus of basalt fiber reinforced matrix modified polypropylene composites with 6.4 mm initial fiber length improved by 18% and 13% as compared with the composites with 3.2 mm initial fiber length.