Solid dispersion is one of these methods, which was most widely and successfully applied to improve the solubility, dissolution rates and consequently the bioavailability of poorly soluble drugs. The solid dispersion is based on the concept that the drug is dispersed in an inert water-soluble carrier at solid state. Several water soluble carriers such as methyl cellulose, urea, lactose, citric acid, polyvinyl pyrrolidone and polyethylene glycols 4000 and 6000 are used as carriers for solid dispersion. Thus the solid dispersion technique can be successfully used for the improvement of dissolution of Paracetamol. Polyvinyl pyrrolidone has been used for the preparation of solid dispersion as a component of the binary system for various drugs such as Tenoxicam.