Objective: In the present study to enhance solubility and in vitro dissolution of poorly aqueous soluble drug Famotidine by preparing solid dispersions using the Kneading method. Methods: Solid dispersions of the drug were prepared by the kneading method using Kollidon and Povidone K30 (as a carrier). Eight different drugs: Carrier ratios were prepared by Factorial design taking three factors, i.e., the concentration of Famotidine (X1), Kollidon (X2), and Povidone K30(X3). Results: DSC, FTIR spectroscopy, powder X-ray diffraction (XRD), and SEM studies were used to characterize solid dispersions. In vitro release was carried out using the USP II dissolution apparatus. Multilinear regression analysis was applied to develop a mathematical model to estimate cumulative drug release. The batch F4 was found to be best batch as it showed maximum solubility and invitro dissolution after 30 min. Improvement in the dissolution behavior of solid dispersion batches was observed due to the conversion of a crystalline form of drug to amorphous form as confirmed by DSC, FTIR studies, and XRD studies. SEM photographs of batch F4 showed porous nature of particle surface. Conclusion: Solid dispersion prepared via Kneading method was proved to be beneficial in enhancement of dissolution rate of poorly- aqueous soluble drug using hydrophilic carriers. Respectively, this model can further be utilized to design solid dispersions for desired release characteristics.