In this report, we have explored the thermal stability and flammability of unsaturated polyester resin (UP) nano-composites blended with flame retardant trixylenyl phosphate (TXP) and nano-filler dodecyl sulphate intercalated magnesium aluminum layered double hydroxide (MgAlDS LDH). MgAl LDH was synthesized by co-precipitation method and anion dodecyl sulphate was intercalated by ion exchange method. The XRD analysis denoted the presence of layered double hydroxide crystal lattice which supports the structural conformation. The IR spectra of trixylenyl phosphate (TXP), MgAl LDH and MgAlDS LDH depicted their relevant vibrational transitions. The nano-composites of unsaturated polyester, crossed linked with styrene, were prepared by mixing varying proportions of TXP and MgAlDS LDH. The XRD of the composites reveal the exfoliation of MgAlDS LDH in polymer matrix, which enhances the thermal stability of nano-composite containing 1% MgAlDS LDH along with TXP than the polymer containing TXP alone, was shown by TGA. The Unsaturated polyester (UP) resin nano-composite decomposes by two stages. There was 8% reduction in peak mass loss rate of nano-composite containing 1% MgAlDS LDH along with TXP in comparison to nano-composite containing only TXP. UL-94 study shows that MgAlDS LDH had flame retardant properties as confirmed by reduction of burning rate in comparison to virgin unsaturated polyester resin. Morphology analysis by SEM on Charred residue of nanocomposite containing 23% TXP and 1% MgAlDS LDH has shown more compact, hard and without any pin holes upper layer than nanocomposite containing only 24% TXP alone. This can be used in preparation of flame retardant articles of unsaturated polyester resin and will allow use of unsaturated polyester on places where it is avoided due to high flammability and low thermal stability. Copyright © 2017 VBRI Press.