We report the preparation of polyaniline (PANI) nanoparticles dispersed in polyvinyl alcohol (PVA) matrix. From SEM picture it is seen that the particle sizes vary from 100-20 nm. Also with increase in PVA content the stability of dispersion is found to increase. Apart from SEM, spin cast films of PANI in PVA are also characterized through XRD and FTIR. XRD shows increase in crystallinity with PVA content and FTIR gives evidence of crosslinking between PANI and PVA molecules. In plane electrical conductivity (in the range of 10 2 Scm -1 ) and the exponent of nonlinear I-V are found to decrease with increase of PVA content. There is a good correlation between SEM, XRD, FTIR and electrical properties.