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Novel interpenetrating polymeric network microspheres of gellan gum and poly(vinyl alcohol) were prepared by the emulsion cross-linking method. Carvedilol, an antihypertensive drug, was successfully loaded into these microspheres prepared by changing the experimental variables such as ratio of gellan gum:poly(vinyl alcohol) and extent of cross-linking in order to optimize the process variables on drug encapsulation efficiency, release rates, size, and morphology of the microspheres. Formation of interpenetrating network and the chemical stability of carvedilol after preparing the microspheres was confirmed by Fourier transform infrared spectroscopy. Differential scanning calorimetry and x-ray diffraction studies were made on the drug-loaded microspheres to investigate the crystalline nature of the drug after encapsulation. Results indicated a crystalline dispersion of carvedilol in the polymer matrix. Scanning electron microscopy confirmed the spherical nature and smooth surface morphology of the microspheres produced. Mean particle size of the microspheres as measured by laser light scattering technique ranged between 230 and 346 microm. Carvedilol was successfully encapsulated up to 87% in the polymeric matrices. In vitro release studies were performed in the simulated gastric fluid or simulated intestinal fluid. The release of carvedilol was continued up to 12 h. Dynamic swelling studies were performed in the simulated gastric fluid or simulated intestinal fluid, and diffusion coefficients were calculated by considering the spherical geometry of the matrices. The release data were fitted to an empirical relation to estimate the transport parameters. The mechanical properties of interpenetrating polymeric networks prepared were investigated. Network parameters such as molar mass between cross-links and cross-linking density for interpenetrating polymeric networks were calculated.