Eutectic gallium indium (EGaIn) is a liquid metal alloy at room temperature. EGaIn microdroplets can be incorporated into elastomers to fabricate highly stretchable, mechanically robust, soft multifunctional composites with high thermal stability1 and electrical conductivity2–4 that are suitable for applications in soft robotics and self-healing electronics5–7. However, the current methods of preparation rely on mechanical mixing, which may lead to irregularly shaped micrometre-sized droplets and an anisotropic distribution of properties8. Therefore, procedures for the stabilization of sub-micrometre-sized droplets of EGaIn and compatibilization in polymer matrices and solvents have attracted significant attention9–12. Here we report the synthesis of EGaIn nanodroplets stabilized by polymeric ligand encapsulation. We use a surface-initiated atom transfer radical polymerization initiator to covalently functionalize the oxide layer on the surface of the EGaIn nanodroplets13 with poly(methyl methacrylate) (PMMA), poly(n-butyl acrylate) (PBMA), poly(2-dimethylamino)ethyl methacrylate) (PDMAEMA) and poly(n-butyl acrylate-block-methyl methacrylate) (PBA-b-PMMA). These nanodroplets are stable in organic solvents, in water or in polymer matrices up to 50 wt% concentration, enabling direct solution-casting into flexible hybrid materials. The liquid metal can be recovered from dispersion by acid treatment. The nanodroplets show good mechanical, thermal and optical properties, with a remarkable suppression of crystallization and melting temperatures (down to −80 °C from 15 °C). Eutectic Ga-In droplets can be functionalized with various polymers and co-polymers using atom transfer radical polymerization. The droplets are ready for direct solution processing to form liquid-metal nanocomposites for potential applications in soft robotics.