Amphiphilic diblock copolymers composed of methoxy polyethylene glycol (MePEG) and epsilon-caprolactone (epsilon-CL) were prepared for the formation of micelles. The copolymer was formed by ring opening mechanism of epsilon-CL in the presence of MePEG containing hydroxyl functional groups at one end of the chain. To estimate their feasibility as vehicles for drugs, MePEG/epsilon-CL block copolymeric micelles were prepared by dialysis against water. Indomethacin was incorporated into the hydrophobic inner core of these micelles as a typical model drug for non-steroidal anti-inflammatory drugs. From the dynamic light scattering measurements, the size of micelle formed was less than 200 mm, and their size increases with the amount of indomethacin encapsulated into the inner core of MePEG/epsilon-CL block copolymers. The selected solvents used to prepare micelles by dialysis in water affect the size of polymeric micelles. As the hydrophobic components of copolymer increase, the critical micelle concentration values and hydrophilic-lipophilic balance decreased. An increase of molecular weight and hydrophobic components of diblock copolymer produced larger micelles.