The bisphenol A type epoxy resin has been modified by p aminobenzoic acid, that leads to the formation of a product with both hydrophillic and lipophillic properties. DSC records indicated good compatibility of the modified resin with unmodified ones. The waterborne coating films obtained from the modified resin and the mixture showed good properties in luster, impact strength, hardness, adhesion, flexibility, and also excellent performance on water resistance and chemical resistance.