This review describes basic chemistry, preparation process, and physical properties of aqueous polyurethane disperisons and the derived films, along with the methods of post treatment to modify the properties. Basic way to render a polyurethane water dispersible without external emulsifier has been described. Regarding the methods of preparation, four major processes are described and compared. Methods to improve the relatively poor water and solvent resistance of aqueous polyurethane dispersions which is introduced by the hydrophilicity and linear structure of polyurethane have been discussed with an emphasis on acrylate incorporations.