The use of biodegradable polymers in daily life is increasing to reduce environmental hazards. In line with this, the present study aimed to develop a fully biodegradable polymer composite that was environmentally friendly and exhibited promising mechanical and thermal properties. Bamboo powder (BP)-reinforced polycaprolactone (PCL) composites were prepared using the solvent casting method. The influence of BP content on the morphology, wettability, and mechanical and thermal properties of the neat matrix was evaluated. In addition, the degradation properties of the composites were analysed through soil burial and acidic degradation tests. It was revealed that BP contents had an evident influence on the properties of the composites. The increase in the BP content has significantly improved the tensile strength of the PCL matrix. A similar trend is observed for thermal stability. Scanning electron micrographs demonstrated uniform dispersion of the BP in the PCL matrix. The degradation tests revealed that the biocomposites with 40 wt·% of BP degraded by more than 20% within 4 weeks in the acidic degradation test and more than 5% in the soil burial degradation test. It was noticed that there was a considerable difference in the degradation between the PCL matrix and the biocomposites of PCL and BP. These results suggest that biodegradable composites could be a promising alternative material to the existing synthetic polymer composites.