The characterization of microcapsules containing drugs is reviewed with particular emphasis on sustained-release products produced commercially by pan or air-suspension coating and intended for oral administration. After considering aspects of the core and coating, various technologies used to assess microcapsules are discussed such as optical and spectroscopic evaluation, particle size analysis, filling into hard gelatin capsules, and disintegration, dispersion and dissolution testing. The in vivo testing of microcapsules and correlation with in vitro data is considered. Finally some miscellaneous tests applied to the formation and assessment of microcapsules are presented.