Cross-linked polyethylene (XLPE) is commonly used as insulation in power cables. In the last decades, extensive researches were initiated to enhance its electrical, chemical, and mechanical properties. This paper aimed to enhance the electrical, thermal, and mechanical properties of the commercial XLPE power cables main insulation using nonfunctionalized and chemically functionalized silicon dioxide (SiO2) nanoparticles. XLPE/SiO2 samples were synthesized using the melt blending method. The functionalization process for SiO2 nanoparticles was carried out to decrease the agglomeration of nanoparticles and distribute it homogeneously inside the polymer matrix of XLPE. The samples were prepared by melt blending of nonfunctionalized inorganic SiO2 nanoparticles denoted as “nonfunctionalized XLPE nanocomposites,” and the samples were prepared by melt blending of SiO2 functionalized inorganic nanoparticles denoted as “functionalized XLPE nanocomposites.” Firstly, the surface of SiO2 nanoparticles was activated using methane sulfonic acid; then, the surface modification was performed using amino silane coupling agent. XLPE/SiO2 nanocomposites were fabricated with different ratios of nanoparticles (0.5, 2, 3.5, and 5 wt.%). The relative permittivity (ɛr) and loss tangent (tan δ) were measured in a frequency range from 1 Hz to 1 MHz. Thermal stability and mechanical properties for a nanocomposite were measured and discussed. It was found that the functionalized nanocomposites have better dielectric, thermal, and mechanical properties compared with the nonfunctionalized SiO2 and XLPE.