Epoxy resin (EP) have the disadvantage of high flammability and large amount of smoke, which greatly restricts its wide application in basic material. In order to obtain EP with excellent smoke inhibition and flame retardance, the flame retardant called as PBO, which with both condensed phase and gas phase flame‐retardant effects, was synthesized by the reaction among p‐phenylenediamine, DOPO, and indole‐3‐carboxaldehyde. From combustion results, EP containing PBO obtained V‐0 grade with a significantly improvement from 22.5% to 30.2% in limiting oxygen index. In comparison with EP, total smoke production, total heat release and the peak of heat release of EP/PBO‐1.0 were declined by 32%, 41.5%, and 37.4%, respectively. Besides, Tg of EP composites also had a certain degree of improvement, which due to the increase of rigidity and crosslinking density of EP caused by the addition of PBO. Meanwhile, the analysis of chars and pyrolysis products of PBO presented that the improvement was assigned to two phase synergy through barrier effect of chars in condensed phase and interrupt chain reaction in gaseous phase.