Polymer network liquid crystals (PNLC) were prepared from u.v. curable polyurethane acrylate and a nematic Liquid crystal mixture (BL001) at a fixed film composition of 2/8 (polymer/LC) by weight. The polymer networks were obtained upon curing the reactive mixture of hydroxyethyl acrylate terminated polyurethane prepolymer, monoacrylate and triacrylate (4/3/3 or 4/4/2).The effects of photoinitiator (PI) concentration, prepolymer molecular weight and cure temperature were studied in terms of morphology, off-state transmittance-temperature relationship, thermal and electro-optic performance of the films. It was found that an optimum PI concentration exists. Below and above the optimum concentration, phase separation is too slow and too fast, respectively, and proper morphology is not obtained regarding the electro-optic performance. The increase in prepolymer molecular weight gave larger phase separation and decreased threshold (V-10) as well as driving (V-90) voltages, together with reduced heating-cooling hysteresis and depression of nematic-isotropic transition temperature. Cure at and slightly below the isotropic temperature gave ideal morphology for PNLC giving rise to the lowest V-10 and V-90.