The invention discloses a technical process to prepare a self-reinforced starch composite used to produce capsules. This composite is made by uniformly mixing the matrix phase and the particulate reinforced phase at a proper proportion, the former being one or a combination of the starches selected from the group consisting of oxidized starch, cationic starch and esterified starch and the latter, cross-linked starch or starch nanocrystals. This composite is processed into the forms of granules, films, or sheets by extrusion method and these different forms of the composite can be used to replace the gelatin as the raw material of capsules because its barrier property, processability, and mechanical properties are significantly improved.