Photocatalytic nanocrystalline neat TiO_2 powders were prepared from alkoxide solutions via the sol-gel method. The alkoxide solutions are formed by adding titanium isopropoxide and acetylacetone (as a chelating reagent) to isopropanol. The surface of anatase TiO_2 nanoparticles could be modified by ferric acetylacetonate complex Fe(acac)_3. This modification could improve the dispersion of TiO_2 in polymer and also the photocatalytic activity. The photodegradation of PEG catalyzed by modified TiO_2 are extensively studied in comparison with that by neat TiO_2. During the degradation, we could observe that the polymer loses its weight gradually, the molecular weight of the polymer decreases, and the molecular weight distribution index increases. The results accord with the degradation characters are also discussed in detail.