In this study, an alternative approach is presented for developing thermo-chromic film, based on ethylene vinyl acetate copolymer (EVA) and vanadium dioxide (VO₂) composite, with enhanced oxidation stability and compatibility. The neat monoclinic nanocrystalline VO₂ particles were firstly prepared via a hydrothermal process, using citric acid as a reducing agent. After that, the synthesized VO₂ particles were characterized, prior to mixing with maleic anhydride grafted PE. The crystalline structure, morphology and thermochromic performance of the polyethylene coated vanadium dioxide (VO₂@PE) particles were then verified by SEM, TEM, DSC, XRD, FTIR techniques. After coating, a better oxidation stability of the VO₂ particles was noted while the thermo-chromic performance of the VO₂@PE was also maintained. After mixing with EVA, the percentage strain and tensile toughness of the VO₂@PE based EVA films was the highest, followed by those of the uncoated VO₂-based EVA films and the neat EVA, respectively. The VO₂@PE-based films also maintained the thermochromic behavior of the monoclinic VO₂. The above improvements were achieved at the expense of percentages of visible light transmittance and gel content of the EVA. This is the first report of the EVA/VO₂-based thermo-chromic film, which is tougher and more stable toward oxidation than the prior state of the art. This composite film has the potential to be used as a kind of a specialty lamination material for smart windows and energy efficiency in buildings.