Nanofillers have helped enhance the utility of thermoset-based composites in different applications by affecting the material properties of the matrix. Quantum-dots (QDs) are known to be one of the smallest nanofillers which help fabricate a well-dispersed polymer matrix nanocomposite. Like other nanofillers, chemical functionalization of these QDs has a positive effect on the material properties. Similar to graphene oxide nanosheets, graphene oxide quantum-dots enable greater interfacial contact with the matrix. In addition to the covalent bonding opportunities, other non-bonded interactions like hydrogen bonds and π–π stacking help promote intimate contact with the matrix. A more detailed investigation using atomistic simulations can unravel the evolution of the nanostructure that improves thermomechanical properties. In this study molecular dynamics is used to engineer graphene quantum-dots (GQDs) with varying degrees of functionalization (hydroxylation) and to reveal the subsequent effects on the epoxy nanocomposite properties. Crosslinking synthesis and mechanical strain simulations were performed to compute the mechanical properties of the material. Results indicate that certain GQD surface functional groups have a considerable effect on the mechanical response of the GQD/epoxy nanocomposite. The nanostructure was further analyzed to provide a physical explanation for the improved material properties.