Aluminium hydroxide is non-toxic, contains no halogens, produces no corrosive products and is inexpensive, all of which are points, but it is limited in two ways in its application. For one thing, like other fillers, it does not act as a reinforcement.

The addition of aluminium hydroxide to thermoplastics causes a reduction in mechanical strength, particularly impact strength, and despite efforts to improve strength by using coupling agents, there is no significant enhancement, so aluminium hydroxide is used in thermosets for over 95% of the time.

In glass fibre reinforced unsaturated polyester cast plastics (e.g. various high or low voltage electrical switches), aluminium hydroxide is used as a filler to make the plastic products flame retardant, smoke retardant and arc resistant. Aluminium hydroxide is also used in FRP laminates such as FRP tiles, tubes, tanks etc., which have a very good flame retardant effect.

The resistance to arcing and arc traces is enhanced. Aluminium hydroxide filled epoxy resins are used in the manufacture of transformers, insulating equipment, switchgear, etc.