To reduce our dependency on petrochemical feedstock, there is a growing interest in utilizing natural biomass to manufacture high‐performance and eco‐friendly materials. Forest‐derived woody biomass contains approximately 20% to 35% lignin by mass, which is mostly underutilized. In the present investigation, lignin feedstock, isolated from the hybrid poplar tree using an n‐butanol‐based solvent mixture, was compounded with acrylonitrile butadiene or nitrile rubber (NBR) at an equal mass ratio to produce hybrid materials under high shear mixing using IntelliTorque Plasticorder. The lignin/NBR blends were modified with several organic acids such as oxalic and malonic acids (0.01 mol of acid/30 g of polymer). The properties such as processing behavior, tensile stress–strain, solvent swelling, melt rheological, and thermal stability of the materials were analyzed. The studies showed that oxalic acid was an effective modifier or cross‐linker, which profoundly increased the thermomechanical properties of the materials. For example, the average tensile strength and modulus of the 50/50 blend of lignin/NBR were 10.9 and 11.8 MPa, respectively, which increased to 15.1 and 396 MPa, respectively, on treatment with oxalic acid. In brief, the mechanical performance revealed that these lignin‐based materials may have potential applications in several areas including building construction and auto‐part manufacturing.