Colloidal Gold nanoparticles (AuNPs) with sodium citrate coating were successfully synthesized using a chemical reduction method with an average spherical size of about 20 nm dispersed in the water with high stability. The localized surface plasmon resonance (LSPR) peak was studied by experimental measurement and Mie theory. The absorbance spectrum of AuNPs exhibits a fingerprint peak in the 500–600 nm range, corresponding to the LSPR of AuNPs. Moreover, PEO/AuNPs nanocomposite films with different concentrations of AuNPs were also prepared to evaluate the effect of LSPR of AuNPs on the electrical conductivity and photoconductivity of nanocomposite films. The degree of crystallinity (Xcrys) and melting enthalpy (ΔHm) increase as the AuNPs content in the polymer matrix increases up to 0.5 wt% due to the enhanced nucleation points. The electrical conductivity of pure PEO film is 1.93×10−6 S.cm−1. Increasing the AuNPs concentration to 0.5 wt% in the PEO matrix leads to an increase in the electrical conductivity to 2.28×10−3 S.cm−1 as AuNPs.