This study details the process of coating theophylline with ethylcellulose using the coacervation technique of microencapsulation. Microencapsulation of theophylline not only renders it sustained-release, but also decreases its gastric irritation and masks the bitter taste (Lin and Yang 1987). The non-solvent addition method was chosen through a literature survey to ascertain various phases of the coacervate (Robinson 1989, Nixon and Wong 1990). A three-phase diagram was used to determine the optimum quantity of each component required. Steps were then carried out to optimize the production. Drug release rates of the prepared microcapsules were determined over 12-h cycles using the U.S.P. dissolution apparatus and the results obtained were compared with those of Knell＇s (Germany) sustained-release theophylline capsules. Significant control over the rate of drug released from the developed dosage form was achieved during the experiment time (12 h). It is concluded that the method employed in this study could be effectively used in the preparation of sustained-release theophylline microcapsules capable of releasing their drug content for an extended period of time. Kinetic studies suggested that both the prepared microcapsules and Knell＇s product followed Higuchi＇s model for drug release. Particle size and release data analysis from five consecutive batches prepared in the laboratory indicated suitable reproducibility of the coacervation process.