Aqueous solutions of poly(N,N-dimethacrylamide-co-glycidyl methacrylate) (DMA-GMA) are shown to undergo liquid-liquid phase separation upon heating. The phase transition temperatures as measured by the cloud point method decreased with increasing levels of the hydrophobic GMA comonomer. The initially formed coacervate microdroplets could be cross-linked by addition of polyamines. The morphology of the resulting hydrogel microspheres depends on both coacervation conditions and cross-linking conditions. Specifically, colloidally stable microspheres were formed at temperatures slightly above the phase transition temperatures, while agglomeration took place at higher temperatures. Low molecular weight polyamines are effective internal cross-linkers for the coacervate droplets, while higher molecular weight polyamines resulted in agglomeration. Addition of sodium dodecyl sulfate increased the phase transition temperatures of polymer solutions dramatically, while addition of poly(vinylpyrrolidone) (PVP) did not affect the phase separation temperatures and could be used as a steric stabilizer.