In order to reduce the cost of plywood and save edible resources (wheat flour), a cheap and resourceful clay, sepiolite, was used to modify urea formaldehyde (UF) resin. The performances of filler-filled UF resins were characterized by measuring the thermal behavior, cross section, and functional groups. Results showed that cured UF resin with SEP (sepiolite) formed a toughened fracture surface, and the wet shear strength of the resultant plywood was maximum improved by 31.4%. The tunnel structure of SEP was beneficial to the releasing of formaldehyde, as a result, the formaldehyde emission of the plywood bonded by UF resin with SEP declined by 43.7% compared to that without SEP. This study provided a new idea to reduce the formaldehyde emission, i.e. accelerating formaldehyde release before the product is put into use.