Inspired by the growing environmental awareness by all, there is a deliber­ate interest in finding new materials that are biodegradable and environmental friendly. Therefore materials derived from natural resources are studied extensively now days. Preparation of novel biocomposites based on cellulose has drawn specific attention. It is expected that cellulose composites will open new areas for medical, packaging, electronic, automotive, building etc applications. This presentation deals with cellulose based composites where different types of cellulose fibers are used as reinforcements in different polymers. Isolation of cellulose nanofibers and nanowhiskers from wood sources as well as different processing technologies for the composites including feeding and mixing techniques will be discussed. The main difficulty when producing cellulose based composites is to disperse the cellulose reinforcement in the polymer matrix without degradation of the polymer or the reinforcing phase. This can be solved by improving the interaction (compatibility) between the fiber and the matrix and by using suitable processing methods. The mechanical properties of composites are important for many applications and results from different studies where cellulose fiber composites and cellulose nanocomposites have studied will be presented.