A microscopic gas-sensing model for ethanol sensors based on polypyrrole-poly(ethylene oxide) (PPy-PEO) composite films prepared electrochemically is proposed. Based on this model, a sensing equation was developed which indicates the dependence of sensitivity of gas sensors on the site number of a monolayer, the thickness of the sensing film, the adsorption equilibrium constant, and the change of site resistance. The sensing parameters in this model obtained from the comparison between the experimental results and the sensing equation provide a more complete insight to the gas-sensing performance. The incorporation of PEO increases the adsorption equilibrium constant and changes the site resistance of the sensing materials, thereby improving the sensitivity of the PEO-PPy sensors. It is also found that the ethanol-sensing abilities are better at a lower polymerization charge.