There has been tremendous interest in developing nanoparticulate drug delivery vehicles for the intracellular delivery of therapeutics. Nanoparticles on the order of hundreds of nanometers in diameter have been shown to be endocytosed by numerous cell types. This mechanism is dependent on particle size, surface charge and hydrophobicity. Uptake of particulate matter is quickly followed by conversion of the endosome to a lysosome via the introduction of hydrolytic enzymes and a proton pump induced drop in pH. Clearly, this is not a friendly environment for biomacromolecules such as proteins and DNA. The use of polybasic hydrogels with a lower critical swelling pH as a carrier would allow for lysosomal escape and subsequent cytosolic drug delivery. This work describes the UV initiated free radical emulsion polymerization of steric stabilizing (and toxicity decreasing) poly(ethylene glycol) grafts onto poly(2-(diethylamino)ethyl methacrylate) polycationic hydrogels (P(DEAEM-g-PEG)). Specifically, microgel and nanogel suspensions were prepared by UV-initiated emulsion polymerization of P(DEAEM-g-PEG). Tetraethylene glycol dimethacrylate and Irgacure 2959 were used as crosslinker and photoinitiator. The particle size was characterized by dynamic light scattering (DLS) and scanning electron microscope (SEM). Changes in particle zeta potential were characterized as a function of pH and PEGylation using electrophoretic light scattering. For potential transmucosal drug delivery applications, the in vitro biocompatibility of these carriers was determined using a Caco-2/HT29-MTX coculture model. Insulin loading and release were monitored using HPLC. Control over particle size was achieved by varying polymerization time (15–60 minutes), surfactant type and concentration, and crosslinking ratio. The processing methods were successful in achieving particles with diameters ranging from 300 nm to 50 ìm in diameter. DLS measurements showed a lower critical swelling pH between 7-7.3 A minimum DEAEM/PEG weight ratio of 1:1 was successful in keeping particles from flocculating through changes in pH. Increasing the PEG content achieved a minimum zeta potential of 15-20 mV. This also lowered the insulin loading efficiency profile and cytotoxicity of the carriers. Current strategies for adding cell targeting specificity to these carriers through the use of different heterobifunctional crosslinking agents and ligands will be outlined.