Novel information about the effects of beta-cyclodextrin (beta-CD) addition and temperature on structural and rheological features of semidilute solutions of alginate and its hydrophobically modified analogue (HM-alginate) is given. Enhanced turbidity is observed for the HM-alginate solutions at high levels of beta-CD addition and low temperatures. The viscosity results revealed cross-linking of the alginate chains at high beta-CD concentrations and low temperatures. Rheological results for the HM-alginate solutions demonstrated that high levels of beta-CD addition and elevated temperatures promoted decoupling of the hydrophobic polymer-polymer associations via inclusion complex formation between beta-CD cavities and the hydrophobic side chains of the polymer. Analysis of small-angle neutron scattering (SANS) results from HM-alginate solutions in the presence of beta-CD suggested that the polymer chains are locally stretched at all of the considered levels of beta-CD and temperatures. The SANS results revealed association structures. The general picture that emerges is that beta-CD addition and temperature can be combined to tune the intensity of the hydrophobic interactions and to cross-link the unmodified alginate.