The stability of alginate-chitosan capsules was shown to depend strongly on the amount of chitosan bound to the capsules. When the capsules were made by dropping a solution of sodium alginate into a chitosan solution (one-stage procedure), all the chitosan was located in a thin alginate-chitosan membrane on the surface. These capsules were much weaker than the capsules made by reacting calcium alginate beads in an aqueous solution of chitosan and calcium chloride (two-stage procedure). Capsules with high mechanical strength were obtained after shorter reaction times when the number-average molecular weight of the chitosan was reduced to around 15,000, when the capsules were made more homogeneous and when the capsule diameter was reduced to around 300 microm. When these capsules were treated with calcium sequestrant such as citrate under conditions where calcium alginate gels normally dissolve, they still had a gel core indicating the presence of chitosan throughout the capsule matrix. The permeability of the two-stage capsules was reduced when the chitosan molecular weight was increased and the degree of acetylation was increased, and when the capsules were made more inhomogeneous. The addition of another several layers of alginate and chitosan resulted in capsules virtually impermeable to IgG, suggesting an average capsule pore diameter less than 90 A.