To decouple the extracellular oxidative toxicity of catechol adhesive moiety from its intracellular non-oxidative toxicity, dopamine was chemically bound to a non-degradable polyacrylamide hydrogel through photo-initiated polymerization of dopamine methacrylamide (DMA) with acrylamide monomers. Network-bound dopamine released cytotoxic levels of H2O2 when its catechol side chain oxidized to quinone. Introduction of catalase at a concentration as low as 7.5 U/mL counteracted the cytotoxic effect of H2O2 and enhanced the viability and proliferation rate of fibroblasts. These results indicated that H2O2 generation is one of the main contributors to the cytotoxicity of dopamine in culture. Additionally, catalase is a potentially useful supplement to suppress the elevated oxidative stress found in typical culture conditions and can more accurately evaluate the biocompatibility of mussel-mimetic biomaterials. The release of H2O2 also induced a higher foreign body reaction to catechol-modified hydrogel when it was implanted subcutaneously in rat. Given that H2O2 has a multitude of biological effects, both beneficiary and deleterious, regulation of H2O2 production from catechol-containing biomaterials is necessary to optimize the performance of these materials for a desired application.