Hydrogel films of Chitosan (CS) and Xanthan gum (XA) of compositions 100/0, 90/10, 80/20, 70/30, 60/40 and 50/50 (w/w) % were prepared and swollen in simulated gastric fluid (SGF) of pH 1.2 and simulated intestinal fluid (SIF) of pH 7.4. To impart stability in acidic environment, semi-interpenetrating polymer network (semi-IPNs) films were formed using glutaraldehyde (GA) as the crosslinking agent. With increase in XA concentration, equilibrium degree of swelling reduced in SGF as well as SIF indicating maximum intermolecular interactions for 50/50 CS/XA semi-IPN. The swelling data was observed to follow second order kinetics. Spectroscopic and thermal analyses of these semi-IPN films also suggest maximum intermolecular interactions for 50/50 CS/XA semi-IPN. The potential of using 50/50 semi-IPN in drug delivery was studied using amoxicillin. In-vitro drug release studies indicated higher drug release in SGF than in SIF suggesting dependence of amoxicillin release kinetics and diffusion coefficient on pH of the environment and drug loading. The results suggest that CS-based semi-IPNs with different crosslinker and XA concentration could be promising candidates for formulation in oral gastrointestinal delivery systems.