The heterogeneous structure and poor compatibility of lignin with polymer matrices have limited its widespread application. In this study, kraft lignin (KL) was fractionated via acid precipitation at different pH levels (9, 7, 5, and 3) to obtain sub-fractions with distinct physicochemical properties. Among them, the fraction obtained at pH 5 (KL5) showed the most favorable characteristics, including the highest yield (~34 %), low sugar content (~2.2 %), and the lowest zeta potential (−37.8 mV), indicating superior aqueous dispersibility and surface charge density. KL5 was further modified with succinic acid (SA) and maleic acid (MA) to introduce carboxyl groups, and both unmodified and modified KL5 samples were incorporated into polyvinyl alcohol (PVA) to prepare composite films. The PVA/KL5-SA film, composed of PVA and KL5 modified with succinic acid, exhibited the highest tensile strength (65.1 MPa), improved water resistance (contact angle, 72°; water solubility, 18 %), and enhanced thermal stability compared to neat PVA. This improvement was attributed to the flexible aliphatic structure of succinic acid, which promotes denser and more uniform crosslinking with PVA chains, leading to the formation of a stable polymer network. This study highlights the effectiveness of acid fractionation in tailoring lignin properties and demonstrates that combined fractionation and chemical modification is a viable strategy for developing lignin-based functional materials compatible with hydrophilic polymers.