The development of biodegradable thermoplastics is required to answer the global need of sustainable materials that can replace non-biodegradable plastics. The commercially available biodegradable polyesters are of interest, but they often suffer of limited processability and performance compared to the traditional non-biodegradable counterpart, such as low-density polyethylene (LDPE). Poly(ε-caprolactone) (PCL) is a biodegradable polyester with potential to replace LDPE, thanks to its comparable mechanical properties. PCL performance can be tuned by crosslinking to extend its service life, without compromising its biodegradability. To further enhance its performance, PCL has also been blended with renewable lignocelluloses to produce biodegradable composites. However, because of their different hydrophilic character and consequent cellulose agglomeration, their blending is not sufficient to disperse cellulose and ensure the desired properties. In this work, reactive melt processing of PCL/cellulose nanocrystals (CNC) was carried out as a sustainable and industrially scalable method with the aim of improving the biocomposites properties and processability. Wet-feeding of CNC was simultaneously coupled with peroxide-initiated radical reaction under the hypotheses of enhanced PCL crosslinking in the presence of water and increased CNC dispersion via wet-feeding. Structural investigations demonstrated an irreversible entrapment of CNC in the insoluble gel of the produced thermoplastic/thermoset yet processable biocomposite. This feature led to a synergy between CNC and PCL crosslinking, as highlighted in the reacted biocomposites properties. In dynamic shear rheology, the viscous PCL behaviour switched to solid-like in the reacted biocomposite. The designed synergy increased PCL elasticity especially in the melt, providing the biocomposite with enhanced creep resistance, recovery and heat-shrinkability, therefore extending its durability and processability.