This paper presents a method for chemical functionalization of CNTs through the combined process of UV/O3 treatment and silanization process. FT-IR and TEM were employed to characterize the changes in surface functionalities and morphology. The results indicate improved dispersion and attachment of silane molecules on the surface of CNTs. Epoxy matrix nanocomposites containing functionalized CNTs showed much better dispersion with associated higher mechanical properties than those without functionalization. These findings confirmed the improved interfacial interactions due to covalent bonding between the functionalized CNTs and epoxy resin.