An integrated circuit package system includes: providing a base package having a first integrated circuit with an inner lead on a periphery thereof and connected thereto with interconnects, and the inner lead partially encapsulated by an inner encapsulation; mounting an outer lead on the periphery of the base package; mounting a second integrated circuit above the base package and connected to the outer lead with the interconnects; and partially encapsulating, the base package and the outer leads with an outer encapsulation leaving a bottom surface of the inner lead and a bottom surface of the outer lead exposed.