The effect of glycerol on the mechanical, thermal and water absorption properties of thermoplastic tapioca starch reinforced rice straw fiber grinded in the range below 100 μm was investigated. Compound formulation was done on twin screw extrusion and the extrudates were pelletized. The compounded samples were processed using compression moulding to form sheet at 150°C for tensile and thermal gravimetric. SEM studies were investigated on fracture surface of composites. Tensile test was done in accordance to ASTM D638. Thermal analysis was used to determine the degradation temperature of composite. Increasing the amount of glycerol increased the tensile strength of composite up to 30 phr of glycerol, however, increasing to 40 and 50 phr glycerol was decrease the strength but elongation at break of composites was increased with increasing glycerol content. Thermal Gravimetric Analysis (TGA) result showed that increased amount of glycerol content lead to decrease in degradation temperature of the composite and SEM micrograph showed that good dispersion and adhesion between rice straw fiber and starch.