Abstract: In this article ABS/wood powder composites were prepared by a twin screw extruder in presence of a small amount of water or subcritical water. The acetone extract of the composite was analyzed with FTIR, from which the effects of extrusion temperature and additive agents were investigated. And the fractured surface morphology of the composite was also observed. It was found that water swelling promoted the interface reaction between wood fiber and ABS or ABS-g-MAH, leading to an improvement of the interface bond strength and the mechanical properties of the composite. When the extruding condition was in the optimum value (at 200 ℃ and with 5 % of ABS-g-MAH) and in the presence of subcritical water, the tensile, flexural, notched and non-notched impact strengths of the ABS/wood powder composite reached 45.3 MPa, 72.4 MPa, 1.5 kJ/m2, and 6.5 kJ/m2 respectively.