Alginate-based hydrogels have several unique properties that have enabled them to be used as a matrix for the entrapment of a variety of enzymes, proteins and cells for applications in bioprocessing, drug delivery and chemical sensing. However, control over release rates or, in some cases, stable encapsulation remains a difficult goal, especially for small particles with high surface-area-to-volume ratios. In this work, the potential to limit diffusion of macromolecules embedded in alginate spheres with nanofilm coatings was assessed. Alginate microspheres were fabricated using an emulsification process with high surfactant concentration to form beads in the size range of 2-10 mu m. Using calcium chloride for ionotropic gelation, dextran was encapsulated in the gel phase by mixing with the alginate in solution. The exterior surface was then modified with polyelectrolyte coatings using the layer-by-layer self assembly technique. Leaching studies to assess retention of dextran with varying molecular weights confirmed that the application of multi-layer thin films to the alginate microspheres was effective in reducing leaching rate and total loss of the encapsulated material from the microspheres. For the best case, the rate of release for dextran of 2 000 000 Dalton molecular weight decreased from 1% h(-1) in bare microspheres to 0.1% h(-1) in polyelectrolyte-coated microspheres. The effectiveness of nanofilms reducing loss of the encapsulated macromolecules was found to vary between different polycation materials used. These studies support the feasibility of using these microsystems for development of long-term stable encapsulated systems, such as implantable biosensors.