HPMC is a popular matrix former to formulate tablets with extended drug release. Tablets with HPMC are preferentially produced by direct compression. However, granulation is often required prior to tableting to overcome poor flowability of the formulation. While continuous twin screw granulation has been extensively evaluated for granulation of immediate release formulations, twin screw granulation of controlled release formulations including the dissolution behavior of the formulations received little attention. Therefore, the influence of the HPMC grade (viscosity and substitution degree) and the particle size of theophylline on critical quality attributes of granules (continuously produced via twin screw granulation) and tablets was investigated in the current study. Formulations with 20 or 40% HPMC, 20% theophylline and lactose were granulated with water at fixed process parameters via twin screw granulation. The torque was influenced by the viscosity and substitution degree of HPMC, but was not a limiting factor for the granulation process. An optimal L/S ratio was selected for each formulation based on the granule size distribution. The granule size distributions were influenced by the substitution degree and concentration of HPMC and the particle size of theophylline. Raman and UV spectroscopic analysis on 8 sieve fractions of granules indicated an inhomogeneous distribution of theophylline over the size fractions. However, this phenomenon was not correlated with the hydration rate or viscosity of HPMC. Controlled release of theophylline could be obtained over 24 h with release profiles close to zero-order. The release of theophylline could be tailored via selection of the substitution degree and viscosity of HPMC.