Urea coating was conducted using polylactic acid (PLA) blended with industrial softwood kraft lignin after applying a dip-coating technique. The lignin was pre-functionalized via esterification that increased coat layer hydrophobicity or via amination that created an organically bound nitrogen structure. The PLA film reference had many pores, while the film from the PLA-lignin derivative complex was highly homogeneous and had no pores. The coat thickness was generally adjustable by repeating the coating process reaching up to 81% weight against the urea core. After coating, urea release in water was largely delayed, 20–30 and 6–10 times as long as that of uncoated urea or PLA-coated urea respectively. The coated urea will be a highly effective nitrogen fertilizer due to the controlled release after coating, the slow release from the organically bound nitrogen structure, and the expectedly extra stability against urease hydrolysis and microorganism nitrification after using the lignin structure.