This research study concentrates on use of phase change material (PCM) in textiles which can produce thermo-regulating characteristics to control body temperature useful for various daily wear and technical textiles. The latent heat which is released or absorbed during the process of phase change is studied and discussed in this research. The PCMs are encapsulated into tiny microcapsules to protect from washing out or abrasion. These microcapsules are bounded onto the fabric surface by using a binder. The microcapsules and their effectiveness are tested by using SEM, Optical Microscope, DSC and Comfort tester. The testing is further extended to the physical and chemical property testing to ensure the performance properties of the textile fabric. The research concludes that Polyethylene Glycol is a good phase change material which can be applied to fabric by using a Polyurethane vehicle to produce ultimate bodywear