The present invention provides suitable methods of solubilization of Oxcarbazepine or pharmaceutically acceptable salts thereof for improving their solubility. The invention also describes sustained release solid oral formulations wherein the formulations comprise oxcarbazepine of improved solubility along with one or pharmaceutically acceptable excipients. The invention describes that the solubility of oxcarbazepine was improved considerable when surfactant like sodium lauryl sulfate was used alone or in combination during spray drying process to achieve amorphous oxcarbazepine. The bilayer tablet formulation prepared containing one immediate release and another sustained release of solubility improved oxcarbazepine indicated complete drug release.