Innovations in sophisticated optoelectronic devices have increased interest in high-refractive index polymers. Herein, we report innovative nanocomposite films with high linear and nonlinear refractive indices prepared by casting chitosan (Cs) with polyvinyl alcohol (PVA) (50:50 wt%) along with different concentrations (10-50 wt%) of sodium montmorillonite (NaMMT) nanoclay. The refractive indices in addition to other optical parameters of homopolymers and hybrid materials were investigated by UV-Vis. spectroscopy and optical modeling to assess their potential applications in optics. Besides, the structure, morphology, and thermal stability of the prepared films were investigated by a multitude of experimental techniques including X-ray diffraction (XRD), attenuated total reflectance-Fourier transform infrared spectroscopy (ATR-FTIR), scanning electron microscopy (SEM), atomic force microscopy (AFM), and thermogravimetric analysis (TGA/DTG). The ATR-FTIR, XRD, SEM, and AFM measurements confirmed the complete exfoliation of NaMMT nanolayers in the Cs/PVA matrix. The TGA/DTG revealed an increase in the thermal stability of Cs/PVA film with increasing clay content. The UV-Vis. measurements revealed a decrease in the optical energy gap (Eg) and a substantial increase in the linear (nD) and nonlinear (n2) refractive indices as clay content increased. Additionally, the nanohybrids displayed low UV transmission and reflected about 80 % of UV rays, making them excellent candidates for UV protection. For the first time, the dissipation factor (tanδ) in the UV/Vis. region has been calculated and fitted with the Drude-Lorentz model to predict the plasma frequency (ωp), resonance frequency (ω0), and electron lifetime (τ) of pristine polymers and nanocomposites.