The concept of aqueous two-phase polymerization and a new polymerization method for the preparation of water-soluble polymers are presented. The phase diagram of poly(acrylamide) (PAAm)-poly (ethylene glycol) (PEG)-water two-phase system was measured by the gel permeation chromatography (GPC). The aqueous two-phase of PAAm-PEG-water system can be easily formed. The critical concentration of phase separation was affected by the molecular weight of PEG. The aqueous two-phase polymerization of acrylamide (AAm) has been Successfully carried Out in the presence of PEG by using ammonium persulfate (APS) as the initiator. The polymerization behaviors with varying concentration of AAm, initiator and PEG, the polymerization temperature, the molecular weight of PEG, and emulsifier types were investigated. The activation energy of aqueous two-phase polymerization of AAm was 132.3 kJ/mol. The relationship of initial polymerization rate (R-p0) with APS and AAm concentrations was R-p0 proportional to [APS](0.72) [AAm](1.28). (c) 2008 Wiley Periodicals, Inc. J Appl Polym Sci 111: 1409-1416, 2009