Knowledge of the effects of different product and process variability on microparticle characterization is essential for the successful development, optimization, and scale-up of an encapsulation process. In the current research, the qualitative application of the Lasentec focused beam reflectance (FBRM) system for online monitoring of microparticle size distribution was demonstrated. lasentec particle vision and measurement (PVM) images were also employed to follow up the steps of microparticle formation and ripening. The drug entrapment efficiency and drug release characteristics were found to be dependent on the polymer, drug, and surfactant concentrations. DSC, FTIR, and XRD data revealed that the drug was compatible with the matrix forming polymer in the solid state. As indicated from the chord count data, FBRM was sensitive to the amount of the solid materials and the number of microparticles formed. Linear relationships with good correlations were obtained between polymer, drug, and surfactant levels and the disappearance rate of 5 to 36.8, 18.4 to 135.9, and 63 to 398 microm chord length fractions. Upon organic solvent evaporation, PVM imaging detected various stages of microemulsion droplets, sheath formation, and solidification with subsequent microparticle hardening. This study illustrated the utility of FBRM and PVM in monitoring the progress of particle formation during drug encapsulation.