Aqueous dispersions of colloidal polyaniline (PANI) were prepared by different methods using a water soluble polymer polyvinylpyrrolidone (PVP) acting as a steric stabilizer. In one of the cases, dispersion was prepared by synthesizing PANI in situ in PVP solution. In another case, PVP-PANI fiber scaffold was prepared by electrospinning and then the electrospun fiber scaffold was dispersed in distilled water. Direct dispersion of PANI in distilled water and aqueous PVP solution were also prepared for comparative studies. Storage stability, anti-oxidant capacity and anti-bacterial efficacies of these dispersions were evaluated. The aggregation between PANI particulates was significantly reduced by using PVP as the dispersing medium. Oxidation state of PANI in these dispersions and the hydrodynamic diameter of the colloidal particles were found to be the critical factors in determining the free radical scavenging capacity and antibacterial activity. Amongst these different PVP based dispersions, the direct dispersion of PANI in PVP solution was the simplest method to produce the colloidal PANI and showed the best free radical scavenging capacity, good antibacterial efficacies as well as storage stability.