Percolation theory predicts the ideal percolation threshold (P-C) for insulator/conductor composites (ICC) to be at 0.16 of the conductor volume fraction in the composite. In this article, we have investigated the percolation behavior in polyvinylidene fluoride/nickel (Ni) composites by varying the Ni concentration. It is observed that the thermal effect/time of heat treatment play a crucial role in changing the value of P-C in a simple random continuum percolative ICC. The effect is attributed to decrease in: (i) intercluster distance, (ii) viscosity of the polymer, and (iii) wetting of the polymer to metal. The heat energy helps the polymer matrix to be melted as a result the metal particles/clusters come closure, that causes an increase in the cluster size of the metal particles. The overall effect is lowering of P-C mainly due to decrease in intercluster distance. A drastic enhancement in the dielectric permittivity with increase of metal content is explained using boundary layer capacitive effect arising due to Maxwell-Wagner-Sillars interfacial polarization of accumulated charges at the metal polymer interfaces and blocking of charge carriers at the insulating boundary. The substantial enhancement of ac conductivity at the P-C is attributed to leakage of charge carriers across the insulating barrier. (C) 2010 Wiley Periodicals, Inc. J Appl Polym Sci 117: 3023-3028, 2010