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Passive components, active components, and interconnecting substrates are the fundamental building blocks for an electronic system, and nowadays, a large percentage of the printed circuit board (PCB) surface area is taken up by the surface-mounted discrete passive components. Embedding these discrete components into the board structure has become the primary method to further miniaturize electronic systems. Besides the size reduction, embedded passives offer many other advantages. Reduced cost and improved electrical performance can be expected, and are actually another two major driving forces of embedded passive technology. To enable embedded passives, materials that satisfy the requirements of fabrication, electrical performance, and mechanical performance need to be developed. We report the innovative development of a low-cost high dielectric constant polymer-based composite that combines the advantages of polymer-ceramic and polymer-metal systems for embedded capacitor application. This novel material uses low cost self-passivated aluminum particles as the filler for the polymer composites. The thin self-passivated Al2O3 layer forms a nanoscale insulating boundary outside of the metallic spheres, which has dramatic influence on the electrical behavior of the resulting composites. The nanoscale insulating oxide layer allows the aluminum composites to have a high dielectric constant as a percolation system; on the other hand, the insulating oxide layer confines the electrons within an aluminum particle, thus keeping a very low loss of the composites.