Phosphate functionalized nanofibrillated cellulose (NFC) was produced through an industrially attractive process, by reacting wood pulp with a phosphate containing salt, followed by mechanical delamination through microfluidization. The degrees of delamination of the phosphorylated NFCs (judged by among others AFM-imaging, rheological studies and tensile strength measurements on NFC films) were found to improve with increasing functionalization of the pulp and number of microfluidization-passes. The NFC systems were found to display similar characteristics as other well-known NFC systems. Interestingly, however, the sufficiently delaminated phosphorylated NFCs exhibited significantly lower oxygen permeability values (at RH 50%) than the published values of several well-known highly delaminated NFC systems. The potential application of the phosphorylated NFC in packaging applications can hence be envisaged.