Paper is one of the most widely used materials for containers, packaging, and non-durable goods. Without modification, paper is biologically degradable. However, due to its hydrophilic and porous nature, it often requires modifications, such as surface coatings, to impart the necessary functionality. Paperboard coatings are primarily extrusion coated using polyolefins, which causes the paper to no longer be biologically degradable and contributes to the rising plastic pollution issue our society is facing. To help maintain the favorable end-of-life properties of paperboard, biologically degradable coatings are being researched as alternatives for functional coatings. Herein we discuss the formulation of a biologically degradable aqueous dispersion based on polyhydroxyalkanoates and the optimization of its application onto paperboard for food and beverage packaging and containers. Formulation components like surfactant systems, viscosity modifiers, solvents and other additives are described and their use in formulating and optimizing stable dispersions are outlined. The functionality of the coating is assessed via barrier properties testing like water absorption, oil and grease resistance, and heat sealing ability. The results of these tests show competitive barrier performance when compared to polyethylene coated substrates currently used in the market and have led to the production of a completely biologically degradable and repulpable coated paperboard.