Water-soluble multiwalled carbon nanotubes (MWNTs) with temperature-responsive shells were successfully prepared by grafting poly (N-isopropylacrylamide) (PNIPAM) from the sidewalls of MWNTs, via surface reversible addition-fragmentation chain transfer (RAFT) polymerization using RAFT agent functionalized MWNTs as the chain transfer agent. Thermogravimetric analysis (TGA) measurements showed that the weight composition of the as-grown PNIPAM polymers on the MWNTs can be well controlled by the feed ratio (in weight) of NIPAM to RAFT agent functionalized MWNTs (MWNT-SC(S)Ph). The MWNT-g-PNIPAM has good solubility in water, chloroform, and tetrahydrofuran (THF). Transmission electron microscope (TEM) and scanning electron microscope (SEM) images also showed that the MWNT-g-PNIPAM was dispersed individually and eventually bonded with the polymer layer by surface RAFT polymerization. The PNIPAM shell is very sensitive to a change of temperature. This method could find potential applications by grafting other functional polymer chains onto MWNTs.