•Chinese Fir residue was used as reinforcement in addition to LDPE matrix.•MPOE, OMMT and their combinations were used as compatibilizers.•MPOE as a compatibilizer improve the impact strength.•The combination of MPOE and OMMT significantly improved the tensile strength. The challenge to improve the interface in wood-plastic composite (WPC) has continued to remain a major setback in the field of wood technology. In this work, a novel hybrid compatibilizer system was developed. Chinese fir (Cunninghamia lanceolata) waste and low-density polyethylene were used as a reinforcing lignocellulosic material and matrix, respectively. Maleic anhydride grafted polyethylene octene elastomer (MPOE), octadecyl organically modified montmorillonite (OMMT) and their combinations were used as compatibilizers. The as-produced composites were characterized for their mechanical and physical properties using the SEM, FTIR, and mechanical testing. The result shows a significant increase in tensile strength of about 41.46 % when a mixture of MPOE and OMMT were used as compatibilizers. Moreover, the addition of MPOE led to the improvement of the impact strength by 26.89 %. Thus, the utilization of both compatibilizers offers an efficient route to improve the interaction and mechanical properties of WPC.