An improved method for the production of a plasticizer-containing dry flowable polyvinyl alcohol (PVA) resin blend capable of thermoplastic processing. The method provides for the incorporation of plasticizers in intimate contact with the PVA resin without heating, cooling, or extended drying steps. Specifically, PVA resin granules having an appropriately small particle size distribution are spray-coated with a liquid plasticizer medium, and then mixed with a dry, fine powder coating medium to produce a flowable, dry plasticized PVA blend. Additional components, such as antioxidants, dyes, and antiblocking agents, may also be incorporated into the finished product.