ZnO nanoparticles were prepared using zinc chloride and sodium hydroxide in chitosan medium. Prepared ZnO (NZO) and commercial ZnO (CZO) was characterized by scanning electron microscopic and X-ray diffraction studies. PP/ZnO nanocomposites were prepared using 0–5 wt% of zinc oxide by melt mixing. It was then compression moulded into films. Transparency of the composite films were improved by reducing the crystallite size of ZnO. Melt flow index studies revealed that NZO increased the flow characteristics of PP while CZO decreased. X-ray diffraction studies indicated α-form of isotactic polypropylene. An increase in mechanical properties, dynamic mechanical properties and thermal stability of the composites were observed by the addition of ZnO. Uniform dispersion of the ZnO was observed in the scanning electron micrographs of the tensile fractured surface of composites.