In this study, we report thermosensitive hydrogels based on poly(ethylene glycol)-block-poly(γ-propargyl-l-glutamate) (PEG-PPLG). (13)C NMR spectra, DLS, and circular dichroism spectra were employed to study the mechanism of the sol-gel phase transition. Mouse fibroblast L929 cells were encapsulated and cultured within the hydrogel matrices, and the encapsulated cells were shown to be highly viable in the gel matrices, suggesting that the hydrogels have excellent cytocompatibilities. The mass loss of the hydrogels in vitro was accelerated by the presence of proteinase K compared to the control group. In vivo biocompatibility studies revealed that the in situ formed gels in the subcutaneous layer last for ∼21 days, and H&E staining study suggested acceptable biocompatibility of our materials in vivo. The presence of alkynyl side groups in the PEG-PPLG copolymers allowed convenient further functionalization with azide-modified bioactive molecules, such as biotin and galactose. The biofunctionalized PEG-polypeptide block copolymers showed sol-gel phase transitions similar to the parent copolymers. Interestingly, the incorporation of galactose groups into the hydrogels was found to improve cell adhesion, likely due to the adsorption of fibronectin (FN) in cell-extracellular matrix (ECM). Because bioactive materials have shown unique advantages in biomedical applications, especially tissue engineering and regenerative medicine applications, we believe our novel functionalizable thermosensitive hydrogels have potential to serve as a versatile platform for the development of new biofunctional materials, for example, bioadhesive and bioresponsive hydrogels.