Intumescent flame retardant polyurethane/starch (IFRPU/starch) composites were prepared by means of melt blending. Microencapsulated ammonium polyphosphate (MCAPP) was added to improve its compatibility with matrix, retardation of reaction between acid and carbon source, and its water resistancy. Fourier transform infrared spectroscopy (FTIR) confirmed the presence of hydrogen bonding and entangled network between IFR system and PU matrix. Further, scanning electron microscopy (SEM) illustrated homogeneity of starch in matrix. By addition of 10 wt % of starch and 20 wt % of IFR, limiting oxygen index (LOI) increased from 22.0 to 40.0 and UL94 V0 rating was achieved. Differential scanning calorimetry (DSC) detected three endothermic transitions and one glass transition (Tg). The temperature of transition III and Tg increased with starch due to crosslinking between PU and starch. The improved thermal stability in the presence of starch was confirmed by thermogravimetric analysis (TGA). Beside the fact that starch was used as a carbonization agent to improve flame retardancy, it also effectively led to enhanced mechanical and viscoelastic properties. © 2014 Wiley Periodicals, Inc. J. Appl. Polym. Sci. 2014, 131, 41158.