Kaolinite is a type of natural clay which has found many applications in different industries such as pulp and paper, ceramics, rubber, and plastics. Kaolinite comprises an alumina octahedral and a silica tetrahedral sheet with a common plane of oxygen atoms sandwiched between them. Asymmetric structure of kaolinite layers, which creates large superposed dipoles and hydrogen bonds between oxygen atoms and hydroxyl groups on the adjacent layer, give rise to a large cohesive energy between the layers. Due to the high cohesive energy, only some limited organic molecules, such as alkali salts or molecules with strong dipole interactions are capable of intercalating the spaces between the layers of kaolinite. In this work a displacement procedure was followed in order to disperse kaolinite clay particles in Polyethylene terephthalate resin (PET). Kaolinite was initially treated with potassium acetate (KAc) and subsequently was blended with polyethylene oxide (PEO) and PET. The X-Ray diffraction technique showed that the crystalline form and layered structure of kaolin particles were totally changed after chemical treatment. Due to the intercalation of KAc molecules into the kaolinite structure, the intensity of characteristic peak of kaolinite (d-spacing = 0.72 nm) was remarkably decreased and new peaks were appeared at lower angles; these peaks were eventually disappeared after blending with the polymer in a twin screw extruder. SEM images revealed that the treatment with KAc and blending with PEO had a significant effect on the dispersion of particles. According to TEM observations, the particles in the composite are 100-200 nm in length and their thickness was generally in the range of 10 to 100 nm. Compared to the as received particles, the dispersion of chemically treated kaolinite in the PET matrix was remarkably improved.