A stacked integrated circuit package-in-package system is provided forming a first device having a first integrated circuit package comprises forming a first substrate with a first integrated circuit thereon, electrically connecting first electrical interconnects between the first integrated circuit and a top side of the first substrate, encapsulating a first top molding compound to cover the first electrical interconnects and a portion of the top side of the first substrate, and encapsulating a first bottom molding compound to cover the first integrated circuit and a bottom side the first substrate, and stacking a second device, having a second integrated circuit package, below the first device with a second top molding compound of the second device providing a space between the first device and the second device, wherein the second device includes the second top molding compound and a second bottom molding compound in a similar manner to the first device.