Nateglinide is an anti-diabetic drug that lowers the blood glucose levels by stimulating insulin secretion from pancreas. Because of low solubility and bioavailability, its usage is limited. In the present study solid dispersions of Nateglinide were prepared by solvent evaporation method and evaluated through various steps for biological correlation. Nateglinide solid dispersions were prepared using PEG 6000, Pluronic F 127 and Labrafil M 1944. A 3-factor, 3-level Central composite design employed to study the effect of each independent variable on dependent variables. X-ray diffraction was used to analyze the crystallinity and FTIR was used to analyze the drug and excipient compatibility. Scanning electron microscopy was performed to analyze the surface of solid dispersion samples. The correlation coefficient showed that the release profile followed Higuchi model (R2= 0.95836). From Korsmeyer peppas model, the release exponent, n was found to be 0.80635 (0.43 < n < 0.85) and followed anomalous behaviour and hence release mechanism was indicative of diffusion. From in vitro dissolution studies it was proved that a Nateglinide solid dispersion may achieve good formulation capability for pharmaceutical manufacturer by increasing solubility and dissolution rate. Key words: Nateglinide, Diabetes mellitus, solid dispersions, solubility, Central composite