In this study, a method was proposed to prepare biocomposites from polylactic acid (PLA) and polyethylene glycol (PEG)-modified lignin using twin-screw extrusion process. The structure of PEG-modified lignin was studied by Fourier transform infrared spectroscopy (FTIR) and gel permeation chromatographic (GPC) analysis. The effects of different contents of soda lignin and PEG-modified lignin on PLA composites were studied by tensile test, differential scanning calorimetry (DSC), thermogravimetric analysis (TGA), scanning electron microscopy (SEM), dynamic mechanical analysis (DMA) and degradation analysis. The experimental results showed that the addition of PEG-modified lignin enhanced the heat resistance of PLA composite. PLA could be combined with up to 30 % PEG-modified lignin, with no significant reduction in tensile strength properties. Compared with PLA-L30, the tensile stress and elongation at break of PLA-PL30 were increased by 26.4 % and 78.9 %, respectively. This approach provided a new way to produce high-performance lignin based-PLA composites and had certain industrial application value.