Polymer nanocomposites are well-known for their superior insulation properties over the existing polymer insulating material due to the existence of nanoparticles. However, the agglomeration of the nanoparticles within the polymer matrix is the main factor that restricts the enhancement of insulation characteristics because the nonuniform dispersion of nanoparticles reduces the interfacial area and creates weak polymer-nanofiller interfacial bonds. Thus, the main contribution of this work is conducting a comprehensive technique of nanoparticle surface modification using atmospheric pressure plasma (APP) to improve the surface compatibility between nanoparticles and polymer matrix, consequently enhancing insulation properties. In this study, the APP with the homogeneous and stable discharge was used in treating the surface of silicon dioxide (SiO2) nanoparticles to enhance its compatibility with cross-linked polyethylene (XLPE) matrices. In comparison with unfilled XLPE, the most effective formulation of XLPE nanocomposites was shown by the sample with 3 wt% of plasma-treated SiO2 nanoparticles with a reduction of partial discharge (PD) magnitude up to 62.85% and the reduction of PD numbers up to 26.70%. Plasma has proven to be a comprehensive technique to improve the PD resistance of XLPE nanocomposites by exciting the formation of more substantial interfacial regions through forming interfacial bonds and reducing the size and number of agglomerated clusters.