Various materials for the semipermeable membrane for microencapsulation of islets, such as alginate complex and agarose, have been used. In this study, a thermoreversible gelation polymer, N-isopropylacrylamide based copolymer was used to make microencapsulated islets and was examined in vitro. The polymer has little or no cytotoxicity for human dermal fibroblasts. The characteristics of viscoelasticity below the soluble gel transition temperature (SGTT) and of thermoreversibility, the water soluble polymer below the SGTT (22 degrees C) becoming water insoluble upon heating, contributed to simplifying the encapsulation technique. We obtained viable islets at the center of the membrane with a thickness of approximately 20-50 microns, accounting for a 40% yield of encapsulated islets. Static glucose challenge test with microencapsulated islets revealed the insulin response to the concentration of glucose. The insulin concentrations of the culture medium in the microencapsulated islet group were the same as those in a similar free islet group up to 42 days. These results indicate that the morphological and functional stability of the new method for microencapsulation may be sufficient for it to be used for transplantation in diabetic animals.