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Polymeric microparticles have been used widely for sustained drug delivery. Current methods of microparticle production can be improved by making homogeneous particles in size and shape, increasing the drug loading, and controlling the initial burst release. In the current study, the hydrogel template method was used to produce homogeneous poly(lactide-co-glycolide) (PLGA) microparticles and to examine formulation and process-related parameters. Poly(vinyl alcohol) (PVA) was used to make hydrogel templates. The parameters examined include PVA molecular weight, type of PLGA (as characterized by lactide content, inherent viscosity), polymer concentration, drug concentration and composition of solvent system. Three model compounds studied were risperidone, methylprednisolone acetate and paclitaxel. The ability of the hydrogel template method to produce microparticles with good conformity to template was dependent on molecular weight of PVA and viscosity of the PLGA solution. Drug loading and encapsulation efficiency were found to be influenced by PLGA lactide content, polymer concentration and composition of the solvent system. The drug loading and encapsulation efficiency were 28.7% and 82% for risperidone, 31.5% and 90% for methylprednisolone acetate, and 32.2% and 92% for paclitaxel, respectively. For all three drugs, release was sustained for weeks, and the in vitro release profile of risperidone was comparable to that of microparticles prepared using the conventional emulsion method. The hydrogel template method provides a new approach of manipulating microparticles.