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Microencapsulation of islets of Langerhans has been proposed in order to prevent immune rejection and possible recurrence of autoimmune disease. This study introduces a fast simple one-step microencapsulation procedure which allows the production of small sized barium-alginate beads. The volume of the microcapsules produced was approximately that of the encapsulated islets. Consequently, the insulin kinetics and the oxygen diffusion were favoured, while the transplanted tissue volume was reduced. Electron microscopy and immunoisolating testing were performed to evaluate the molecular cut-off, the physical and chemical characteristics of these microcapsules. Immunohistochemical staining and perifusion experiments of microencapsulated pancreatic islets showed their viability after the encapsulation procedure as well as in vivo experiments. In fact, microencapsulated porcine islets were implanted intraperitoneally into streptozotocin-diabetic rats. The xenografts reversed the hyperglycemic state and functioned for a period ranging from 9 to 385 days. The low mannuronic acid concentration and the purity grade of the alginate, exerted a combined influence on the capsule biocompatibility as in vivo studies showed.