Rubber particles, to be used as fillers or extenders for various composite polymer systems, are chlorinated by a gas-solid phase reaction with a chlorine-containing gas. A composite polymer containing the chlorinated rubber fillers or extenders exhibits a higher flexural modulus than if prepared using an unchlorinated rubber filler or extender. Chlorination of the rubber particles is carried out by contacting the finely divided rubber particles with a chlorine-containing gas comprising at least about 5 volume percent chlorine. Advantageously, the chlorine can be diluted with air, nitrogen or other essentially inert gases and may contain minor amounts of fluorine. Improved performance is obtained with nitrogen dilution of the chlorine gas over air dilution. Improved polymer composite systems having higher flexural modulus result from the use of the chlorinated rubber particles as fillers instead of unchlorinated rubber particles.