The application of nylon microencapsulation as a drug delivery system inherently demands that the microencapsulated matrix should not cause degradation of the encapsulated drug. The presence of alkaline hexamethylenediamine (HMD) in the microcapsule core will affect the final pH of the microcapsules and may influence the stability of some drugs. To follow the pH within the microcapsule core during manufacture, pH indicators were encapsulated. The final pH was found to depend on the formulation used and could be controlled by the addition of acid. Several other variables affecting the nylon wall formation were examined to determine optimum processing conditions. Increased agitation produced a decrease in microcapsule size. This cause an increase in nylon weight recovered. The increased recovery of nylon was due in part to nylon formation over a larger surface area. Varying the amounts of HMD and sebacyl chloride (SC) used also affected the total weight of nylon formed. In general, more nylon is recovered as the level of each reactant increases. However, the molar ratio of HMD:SC determined the total amount of nylon formed when SC was present in excess.