Aqueous dispersions of polymer encapsulated TiO₂ particles comprising polymer encapsulated stable particulate dispersion of TiO₂ together with a process of preparation of the same. Said polymer encapsulated stable particulate dispersion includes TiO₂ particles surface adsorbed with anionic dispersion agent providing a micellar like structure with matrix type encapsulation of said TiO₂ particles in the composite, favouring reduction of TiO₂ levels in paint formulations.