We report a facile synthesis for lignin/titanium dioxide (TiO2) nanoparticles (LT NPs) at room temperature by confining assembly of lignin macromolecules. The LT NPs had a uniform nanosize distribution (average diameter ∼ 68 nm) and were directly employed as multifunctional nanofillers to reinforce a waterborne polyurethane wood coating (WBC). X-ray diffraction, Fourier-transform infrared spectroscopy, and X-ray photoelectron spectroscopy revealed the mechanism by which formed TiO2 confined lignin assembly. The LT NPs considerably increased the tensile strength of a WBC film from 16.3 MPa to 28.1 MPa. The WBC–LT NPs exhibited excellent ultraviolet (UV) A and UVB blocking performances of 87 % and 98 %, respectively, while maintaining 94 % transmittance in the visible region. Incorporating LT NPs into the WBC enhanced the coating performance (the hardness, adhesion, and abrasion resistance) on wood substrates. A quantitative color and texture analysis revealed that the LT NPs increased the decorativeness of actual wooden products. After nearly 1800 h of UV irradiation, wood coated with the WBC–LT NPs exhibited good color stability, where the original color remained unchanged or even became brighter. In this study, value-added valorization of lignin is enabled by using organic–inorganic nanofillers and insights are gained into developing multifunctional WBCs.