The present work aims to investigate the effect of stearic acid-grafted starch (ST-SA) on the rheological, thermal, optical, dynamic mechanical thermal, and tensile properties of linear low density polyethylene/thermoplastic starch (LLDPE/TPS) blends, as well as on their water vapor and oxygen barrier properties. Blends consisting of LLDPE and TPS in a weight ratio of 60:40 and ST-SA at different concentrations, i.e. 1, 3 and 5%, were prepared using a twin-screw extruder. The obtained resins were subsequently converted into films via blown film extrusion. Incorporation of ST-SA resulted in a decreased degree of shear thinning, reduced ambient temperature elasticity, and improved tensile strength, secant modulus, extensibility, and UV absorption, as well as diminished water vapor and oxygen permeabilities of the LLDPE/TPS blend. These effects are attributed to the enhanced interfacial adhesion between LLDPE and TPS phases through the compatibilizing effect induced by ST-SA, and the good dispersion of the TPS phase in the LLDPE matrix. The results confirmed that ST-SA could potentially be used as a compatibilizer for the LLDPE/TPS blend system.