In this study, water acts as a co-blowing agent to support carbon dioxide (CO 2 ) in the extrusion foaming process of polystyrene (PS) to produce foams with very low density for thermal insulation applications. Herein, we report a simple suspension polymerization method to prepare water expandable polystyrene (WEPS) based on a PS/water containing activated carbon (AC) composite. AC pre-saturated with water was introduced into the styrene monomer to form a water-in-oil inverse emulsion without emulsifiers. Via suspension polymerization, water expandable PS/AC (WEPSAC) beads could be subsequently obtained. Low density PS foams (∼0.03g/cc) were successfully produced in the CO 2 extrusion foaming process using WEPSAC. Because of lower foam density and better IR absorption due to the presence of water containing AC, WEPSAC foams provided a lower thermal conductivity than conventional talc reinforced PS foams.