The aim of this study was to develop a pH-sensitive chitosan/polyvinyl pyrrolidone (PVP) based controlled drug release system for repaglinide. The hydrogels were synthesised by crosslinking chitosan and PVP blend with glutaraldehyde to form a semi-interpenetrating polymer network (semi-IPN). These semi-IPNs were studied for their content uniformity, swelling index (SI), mucoadhesion, wettability, in vitro release and their release kinetics. The hydrogels showed more than 95% loading of repaglinide. These hydrogels showed high swelling and mucoadhesion under acidic conditions. The swelling was found due to the protonation of a primary amino group on chitosan. In acidic condition chitosan was ionized, and adhesion occurred between the positively charged chitosan and the negatively charged mucus. In the physiological condition less swelling was noticed. In vitro release study revealed that formulation containing chitosan (2% w/v) and PVP (4% w/v) in the ratio of 14:6 w/w showed complete drug release after 12h. Release profile showed that all the formulations followed non-fickian diffusion mechanism (diffusion coupled with swelling). Fourier transform infrared (FTIR) spectroscopic analysis revealed proper crosslinking of polymer and formation of semi-IPN as well as presence of drug in the formulation. Differential scanning calorimetry (DSC) and powder x-ray diffraction (p-XRD) study revealed the presence of repaglinide in crystalline form in the formulations. The surface morphology of semi-IPN was studied before and after dissolution in simulated gastric fluid (SGF, pH 1.2) which indicated generation of open channel-like structure in hydrogel after dissolution. The results of study suggest that semi-IPNs of chitosan/PVP are potent candidates for delivery of repaglinide in acidic environment.