An alternative Nafion composite membrane was prepared by incorporating various loadings of CeO 2 nanoparticles into the Nafion matrix and evaluated its potential application in direct methanol fuel cells (DMFCs). The effects of CeO 2 in the Nafion matrix were systematically studied in terms of surface morphology, thermal and mechanical stability, proton conductivity and methanol permeability. The composite membrane with optimum filler content (1 wt. % CeO 2 ) exhibits a proton conductivity of 176 mS·cm −1 at 70 • C, which is about 30% higher than that of the unmodified membrane. Moreover, all the composite membranes possess a much lower methanol crossover compared to pristine Nafion membrane. In a single cell DMFC test, MEA fabricated with the optimized composite membrane delivered a peak power density of 120 mW·cm −2 at 70 • C, which is about two times higher in comparison with the pristine Nafion membrane under identical operating conditions.