Three-dimensional (3D) cell culture provides an effective way over conventional two-dimensional (2D) monolayer culture to more closely imitate the complex cellular organization, heterogeneity, and interactions as well as tissue microenvironments in vivo. Here we present a novel droplet-based 3D cell culture method by using droplet array attached on the sidewall of a PDMS piece. Such an arrangement not only avoids cells from adhering on the chip surface for achieving 3D cell culture in nanoliter-scale droplets, but also facilitates performing multiple operations to cells in droplets, including cell suspension droplet generation, drug treatment, and cell staining with a capillary-based liquid handling system, as well as in situ observation and direct scanning with a confocal laser scanning microscope. We optimized the system by studying the effects of various conditions to cell culture including droplet volume, cell density and fabrication methods of the PDMS pieces. We have applied this system in the 3D culture of HepG2 cells and the stimulation testing of an anticancer drug, doxorubicin, to 3D cell spheroids.