Display omitted •Fabrication of PVA/Nanocellulose/Ag nanocomposite films by solution casting method.•Synthesis of starch-capped silver nanoparticlres (Ag NPs).•Good antibacterial activity against Gram-positive and Gram-negative bacteria.•The addition of NC and Ag NPs enhanced the mechancial and thermal properties.•Water vapor transmission rate was decreased with the incorporation of NC and Ag NPs. Antimicrobial packaging is an area of emerging interest and is rapidly expanding with application of nanotechnology. The present work investigates the effect of nanocellulose (NC) and Ag NPs on the physical, mechanical and thermal properties of PVA nanocomposite films. The tensile strength of PVA was improved from 5.52 ± 0.27 MPa to 12.32 ± 0.61 MPa when filled with 8 wt% of NC. Nanocomposite films exhibited strong antibacterial activity against both Staphylococcus aureus (MRSA) and Escherichia coli (DH5-alpha). The maximum inhibition zone at 0.5 g Ag NPs with 12 wt% NC against DH5-alpha was 14 ± 0.70 mm. While, the maximum inhibition zone at 0.3 g Ag NPs for 16 wt% NC was 13.6 ± 0.68 mm against MRSA. Moreover, nanocomposites films have no cytotoxicity effect on HepG2 and cell viability was more than 90%. Based on mechanical properties and antibacterial potential of the developed nanocomposite films, it can be envisaged to use these films for packaging applications.