A facile surface hydroxylation treatment to modify the surface of nickel nanoparticles dispersed in ferroelectric polyvinylidene fluoride (PVDF) is reported. A remarkable increase in the amount of polar β phase of PVDF has been observed upon dispersion of nickel nanoparticles in the PVDF matrix. The leakage current reduces drastically in the composite with surface-modified nickel nanoparticles. This improvement has been observed with concurrent enhancement of electrical polarization in the surfacemodified nickel−PVDF composite. However, the magnetic moment  of the modified composite is found to be slightly lower than that of the unmodified composite. Most importantly, the composite with surface-modified nickel exhibits magnetodielectric coupling significantly higher than that of the unmodified composite. The magnetodielectric coupling appears to be facilitated by surface hydroxyl groups on nickel. These results establish the potential of facile surface functionlization of nanoparticles toward the design of nanocomposites with higher magnetoelectric coupling.