We report a covalent functionalization of graphene nanoparticles (GnPs) employing 2,3,4-Tri-O-acetyl-β-D-xylopyranosyl azide followed by fabrication of an epoxy/functionalized graphene nanocomposite and an evaluation of its thermo-mechanical performance. Successful functionalization of GnP was confirmed via thermal and spectroscopic study. Raman spectroscopy indicated that the functionalization was on the edge of the graphene sheets; the basal plane was not perturbed as a result of the functionalization. The epoxy/functionalized GnP composite system exhibited an increase in flexural modulus (~18%) and glass transition temperature (~10°C) compared to an un-functionalized GnP based epoxy composite.