Stable water-borne polyurethane dispersions (PUDs) were prepared from bifunctional aliphatic polycarbonate-based macrodiol, 2,2-bis(hydroxymethyl)propionic acid (DMPA), 1,6-diisocyanatohexane, 1,4-butanediol (BD), and triethylamine. Water-borne dispersion particles are thus solely formed from self-assembled linear PU chains. Both PUDs and PUD-based films were characterized with regards to the concentration of DMPA (ionic species content) and BD (hard-segment content). Average particle size of PUDs decreased and their long-term stability increased with increasing DMPA and decreasing BD concentration. Functional properties of cast films made from PUDs are substantially influenced by the character of the original colloidal particle dispersions. The swelling behavior of the films, their surface morphology, and mechanical properties are more influenced by DMPA than BD contents. At DMPA concentrations higher than 0.2 mmol g−1 of the solid mass of polyurethane, distinct self-organization of individual nanoparticles into fibril-like structures was detected by atomic force microscopy and scanning electron microscopy. PU films made from PUD containing high BD as well as high DMPA concentrations have the best utility properties namely sufficient tensile properties and a very low swelling ability. © 2015 Wiley Periodicals, Inc. J. Appl. Polym. Sci. 2015, 132, 42672.