Multiferroic nanocomposite films, composed of well-dispersed, magnetic Ni0.5Zn0.5Fe2O4 (NZFO) nanoparticles (in the size range 10−20 nm) embedded into a poly(vinylidene-fluoride) copolymer matrix host, have been prepared by a modified polymer processing route. The dielectric, ferroelectric, ferromagnetic and magnetodielectric properties of these nanocomposite films have been systematically investigated. The nanocomposite films exhibit low dielectric loss and good ferroelectric character. The magnetodielectric coefficient of the resultant nanocomposite films increases as a function of the NZFO fraction and is almost frequency independent. A giant magnetodielectric coefficient up to 5.1% was obtained at room temperature and under a low magnetic field of 0.3 T. The giant magnetodielectric effect together with low dielectric loss suggests the nanocomposite NZFO films are promising for use in smart multiferroic devices.