Lignin is an abundant polyphenol biopolymeric material. Due to its aromatic structure it develops a char under fire conditions. Lignin was used as flame retardant in acrylonitrile-butadiene-styrene (ABS). Enhancement of flame retardancy was observed, and the lignin was then phosphorylated to achieve highest performance. For the first time, characterization of FR phosphorylated lignin (P-LIG) was undertaken in detail. Grafting phosphorus onto lignin significantly increases the amount of residue from the polymer blend at high temperature. At 30 wt.%, P-LIG is well dispersed in ABS and leads to a significant reduction of the peak of heat release rate. It is shown that P-LIG promotes char formation by reacting with ABS during thermal decomposition. The char is therefore more cohesive and acts as a protective layer, such that less fuel from ABS degradation is released to the flame. Thus phosphorylated lignin is as a promising bio-based flame retardant for ABS.