Shape memory polymer composites based on a blend of thermoplastic polyurethane (TPU) segmented block copolymer and Poly (-caprolactone) (PCL) with weight ratio of 70/30 and various nanomagnetite contents (0-5 wt%) were prepared by melt blending of TPU and PCL, together with a masterbatch of TPU/nanomagnetite. The samples were compounded for 10 minutes at 200°C using an internal mixer. Synthesized nanomagnetite powder was introduced to the masterbatch via a solution mixing method using a high intensity ultrasonic horn. Subsequently, thermal, mechanical, rheological and electrical properties of the TPU/PCL/nanomagnetite shape memory composites were investigated through various tests. The degree of crystallization of the PCL component in the composite structure was inspected by differential scanning calorimetry (DSC) and X-ray diffraction (XRD) measurements. Results reveal that the percentage of crystallinity and the melting temperature of the PCL component change in the presence of magnetite nanoparticles, which is perhaps related to the nanoparticles acting as nucleants. Observing a single glass transition temperature (Tg) in DSC thermograms of the samples is indicative of good compatibility of the TPU and PCL components in the composite structure. This is also confirmed by dynamic-mechanical analysis in which loss modulus curves showed a single glass transition temperature. Moreover, the loss modulus peak at glass transition was decreased and broadened by addition of nanomagnetite, from which it is hypothesized that introducing nanoparticles into the system changes the mechanism of glass transition due to particle-matrix interaction. The dynamic rheological and electrical resistivity experiments verified the existence of a low percolation threshold at about 2 wt% nanomagnetite. The state of nanomagnetite dispersion in the masterbatch and the microstructure of the ternary composites were characterized by scanning electron microscopy (SEM). Finally, adding nanomagnetite lead to a reduction in shape recovery of the polymer blend, with shape recovery dropping to 70% at 5% of nanomagnetite.