ε-HNIW was coated with aqueous polyurethane emulsion by demulsification. The factors affecting the coating efficiency and the impact sensitivity of coated ε-HNIW were investigated and analyzed via orthogonal L9(3⁴) test design and single factor experiment. The experiment results show that the important factors are coating temperature, the add-on of solvent and demulsifier solution, and agitating rate. The temperature and the add-on of solvent are directly related with the particle size, size distribution of the coated ε-HNIW and the coating efficiency. The optimum conditions are reaction temperature 45 ℃, the weight ratio of solvent PU 8∶1, the weight ratio of demulsifier solution PU 4∶1, agitating rate 300 r·min^-1. The surfactant is added to the reaction system after demulsification to control the particle size and prevent the granules to agglomerating. The coating decreases the impact sensitivity as the H₅₀ of ε-HNIW increases from 15 cm(uncoated) to 37 cm (coated).