The aim of the present study was to investigate the suitability of insoluble Eudragit® water dispersions (NE, NM, RL, and RS) for direct high-shear granulation of very soluble levetiracetam in order to decrease its burst effect from HPMC K100M matrices. The process characteristics, ss-NMR analysis, in vitro dissolution behavior, drug release mechanism and kinetics, texture profile analysis of the gel layer, and PCA analysis were explored. An application of water dispersions directly on levetiracetam was feasible only in a multistep process. All prepared formulations exhibited a 12-hour sustained release profile characterized by a reduced burst effect in a concentration-dependent manner. No effect on swelling extent of HPMC K100M was observed in the presence of Eudragit®. Contrary, higher rigidity of formed gel layer was observed using combination of HPMC and Eudragit®. Not only the type and concentration of Eudragit®, but also the presence of the surfactant in water dispersions played a key role in the dissolution characteristics. The dissolution profile close to zero-order kinetic was achieved from the sample containing levetiracetam directly granulated by the water dispersion of Eudragit® NE (5% of solid polymer per tablet) with a relatively high amount of surfactant nonoxynol 100 (1.5%). The initial burst release of drug was reduced to 8.04% in 30 min (a 64.2% decrease) while the total amount of the released drug was retained (97.02%).