We have constructed polymer-stabilized nematic liquid crystals by photopolymerizing diacrylate monomers in the nematic phase. The orientation of the liquid crystal was controlled by the polymer network. We studied the Freedericksz transition in these systems. Experimentally we studied the transition by measuring the capacitance of the liquid crystal cells as a function of applied voltage. The transition was affected profoundly by the dispersed polymer network. The threshold was higher with shorter interpolymer network distance. Theoretically we studied the systems using a two-dimensional model in which the polymer networks were represented by parallel cylinders with random location. The interaction between the liquid crystal and the polymer network was described by the boundary condition imposed by the polymer network. By fitting the experimental data, we found that the polymer cylinders had diameters of a few submicrons, and a substantial amount of liquid crystal was trapped inside the cylinders.