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In this work, phosphonium ionic liquids (ILs) based on tetra-alkylphosphonium cations combined with carboxylate, phosphate and phosphinate anions, were used for organic modification of layered double hydroxide (LDH). Two different amounts (2 and 5 wt %) of the organically modified LDHs were mixed with poly(butylene adipate-co-terephthalate) (PBAT) matrix by melt extrusion. All prepared PBAT/IL-modified-LDH composites exhibited increased mechanical properties (20–50% Young’s modulus increase), decreased water vapor permeability (30–50% permeability coefficient reduction), and slight decreased crystallinity (10–30%) compared to the neat PBAT.