A bio-polyelectrolyte (PC) was synthesized by reacting phytic acid (PA) with casein (CS), and used as the shell materials to microencapsulate ammonium polyphosphate (APP). The obtained core-shell structured flame retardant (PC@APP) was incorporated into polylactic acid (PLA). The dispersion of PC@APP was greatly improved. As a result, the elongation at break and notched impact strength were improved from 6.9% and 3.5 KJ/m2 of neat PLA sample to 14.4% and 4.7 KJ/m2 of PLA samples containing 5%PC@APP. Moreover, the fire resistance of PLA/5%PC@APP composites was also enhanced. The limiting oxygen index (LOI) value was increased from 19.6% to 28.3%; the vertical burning (UL-94) rating was upgraded from no rating to V-0; and the peak heat release rate value was decreased from 935.8 kW/m2 to 747.9 kW/m2. It is suggested that the well-dispersed PC@APP alters the degradation routine of PLA matrix, leading to the rapid formation of physical barriers.