The material development is aimed at utilizing a suitable Metal Alloy in combination with a most appropriate plastic material considering the achievement of desirable basic features of Smart materials like Shape Memory Effect, Flexibility, recovery time etc. In the present work shape memory composites were developed using Ni-Ti alloy as reinforcement into the epoxy matrix. To understand the recovery and the influence of the Young's modulus of the matrix, three different combinations of epoxy and hardeners are used. This experiment has considered different combinations of Ni-Ti SMA wire spacing, Ni-Ti SMA wire orientations and Epoxy Mix proportions. The experiments are designed based on 'Taguchi's' L9 orthogonal arrays. 'Taguchi's' method combined with S/N ratio of analysis is used as the statistical tool for optimization of the most recommendable combination of the newly developed SMA polymer composite material. This is due to the special intention of finalizing the most advantageous product in view of physical properties, percentage shape recovery, recovery time etc. © (2014) Trans Tech Publications, Switzerland.