Stretchable and flexible conductive polymers have aroused great interest recently because of their applications in the fields of novel electronics, such as smart textiles, artificial electronic skin, flexible electronic displays, etc. In this work, stretchable and flexible conductive thermoplastic polyurethane (TPU)/graphene composite foams have been developed by water vapour induced phase separation. The as-prepared TPU/graphene composite foams exhibited a lower modulus, larger elongation at break, and lower hysteresis during a cycle tensile test than a TPU/graphene composite did. It is expected that the improved elasticity of the TPU/graphene composite foams was caused by the deformation of cells, which partially offset the deformation of the TPU matrix. In addition, the cell walls divided the whole composites into many small parts, which could further restrain plastic deformation of hard segment domains under deformation.