Sterically stabilized hybrids of cellulose nanowhiskers (CNWs) and silver nanoparticles (AgNPs) were prepared via poly(ethylene glycol) (PEG) grafting and subsequent reduction of Ag+ counterions by sodium borohydride (NaBH4) for improved dispersion stability after hybridization. The preparation scheme includes surface carboxylation of CNWs using a 2,2,6,6-tetramethyl-1-pyperidinyloxy radical (TEMPO), grafting of monomethoxy PEG (mPEG) via amidation mediated by 1-ethyl-3-(3-dimethylaminopropyl)carbodiimide hydrochloride or 4-(4,6-dimethoxy-1,3,5-triazin-2-yl)-4-methylmorpholinium chloride, exchange of countercation of residual carboxyls to Ag+, and deposition of AgNPs via reduction with NaBH4. UV-vis spectroscopy and electron microscopy analyses confirmed the successful deposition of AgNPs. Most of the mPEG-grafted hybrids were stable under the presence of an electrolyte, although some of them were precipitated by the addition of 0.1 M CaCl2. The addition of CaCl2 was also found to trigger discoloration of the hybrids, suggesting the partial dissolution of AgNPs and the formation of water-insoluble AgCl.