An effective method to functionalize chitosan with 4-hexyloxyphenol (HP) under homogeneous reaction conditions was developed using laccase as the catalyst. The resulting copolymer was characterized for chemical structure, grafted-HP content, surface morphology, thermal stability, antioxidant capacity, hydrophobic properties and tensile strength. Solid-state 13C NMR spectrum confirmed the incorporation of HP onto chitosan. X-ray diffraction (XRD) showed a decrease in the degree of crystallinity for laccase/HP treated chitosan compared to pure chitosan. The grafted-HP content in laccase/HP-treated chitosan first increased and then declined with increase of the initial HP/chitosan ratio. A heterogeneous surface with spherical particles on the laccase/HP treated chitosan was observed by environmental scanning electron microscopy (ESEM) and scanning probe microscopy (SPM). The laccase/HP treatment of chitosan improved the thermal stability of copolymer. More significantly, the HP functionalized chitosan showed greatly improved ABTS+ and DPPH radicals scavenging capacity, compared with pure chitosan. The hydrophobicity property of the HP functionalized chitosan also significantly increased although its tensile strength decreased. This new type of composite with double functionalities (i.e., antioxidant and hydrophobic) could potentially be used as food packaging materials or coating agents.