A novel process for the preparation of the polypyrrolelpoly(vinyl chloride) (PPy/PVC) conductive composites is reported. The procedure involves chemically polymerizing pyrrole in the presence of a PVC powder dispersed in an aqueous solution of FeCl3. The PPy-encapsulated PVC particles were compressed-molded into conductive composite materials. The PPy contents in the pre-localized PPy/PVC composites were determined by elemental analyses. The effect of PPy content and processing conditions on the electrical conductivity were studied and the thermal decay of the electrical conductivity and environmental stability were also investigated. A very low percolation threshold value (0.3 wt%) has been obtained with these composite materials. The electrical conductivity of the PPy/PVC composite samples with only 1.6 wt% of PPy can be at least 10 orders of magnitude greater than that of the pure PVC sample. The surface morphology of the pre-localized PPy/PVC composites was characterized by means of a dynamic contact angle (DCA) analyser, a scanning electron microscope (SEM) and an optical microscope. The results of the dynamic angle analyses agree qualitatively with the results predicted for a heterogeneous surface. In addition, the sharp transition in the plot of the receding angle as a function of the PPy content which occurs at about 2 wt% of PPy may be related to the sharp increase in the conductivity at approximately the same PPy content.