The two-stage dough mixing process was innovated to improve the qualities of bread made from potato flour (PF) and wheat flour at a ratio of 1:1 (w/w). The final dough was first prepared from wheat flour before being added with PF. The effects of the method on enhancing the dough qualities were verified, and the distribution of water in gluten-gelatinized starch matrix of the doughs was investigated. We observed that the bread qualities were improved, as reflected by the increase of specific volume from 2.26 to 2.96 mL g–1 and the decrease of crumb hardness from 417.93 to 255.57 g. The results from rheofermentometric measurements showed that the dough mixed using the developed mixing method had higher maximum dough height value, time of dough porosity appearance, and gas retention coefficient, as well as enhanced gluten matrix formation compared to that mixed by the traditional mixing method. The results from low-field nuclear magnetic resonance confirmed that the competitive water absorption between gluten and gelatinized starch could restrict the formation of gluten network in the dough mixed using the traditional mixing process. Using the novel mixing method, gluten could be sufficiently hydrated in stage 1, which could then weaken the competitive water absorption caused by gelatinized starch in stage 2; this could also be indicated by the greater mobility of proton in PF and better development of gluten network during mixing.