Hydrophilic-hydrophobic chitosan derivatives were obtained through the attachment of lactose and alkyl groups to the amino group of chitosan with potassium borohydride. The carboxymethylation of the chitosan derivatives was completed. They had excellent solubility in water. When they were prepared as hydrogels, the hydrogels had adjustable hydrophobicity and excellent hydrophilicity according to swelling measurements. All of them showed potential for applications in medical fields. (C) 2004 Wiley Periodicals, Inc.