Nanocomposites of thermoplastic polyurethane (TPU), which were prepared using two types of functionalized graphene sheets (FGS) of similar thickness but different sizes were examined. The percolation threshold of the nanocomposite was reduced, evidently by increasing the particle size of the FGS. This means that the FGS with a mean particle size of 8.3 ${mu}m$ had a percolation threshold at 0.39 wt% in the nanocomposite of TPU, whereas it was 1.41 wt% when the FGS size was 2.4 ${mu}m$. The FGS enhanced the modulus of TPU through a reinforcing effect but both the tensile strength and elongation at break were reduced as the FGS content was increased. These effects of FGS on the tensile properties were more evident with a larger particle size of FGS. The morphology and thermal properties of the nanocomposites were also examined.