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In the present study aceclofenac-gelatin micropellets were prepared by the cross linking technique using gluteraldehyde as cross linking agent and characterized by X-ray diffractometry, differential scanning calorimetry and scanning electron microscopy. The effect of drug: polymer ratio, temperature of oil phase, amount of gluteraldehyde and stirring time was studied with respect to entrapment efficiency, micropellet size and drug release characteristics. Spherical micropellets having an entrapment efficiency of 57% to 97% were obtained. Differential scanning calorimetric analysis confirmed the absence of any drug-polymer interaction. The micromeritic studies of micropellets show improved flow property. The entrapment efficiency, micropellet size and drug release profile was altered significantly by changing various processing parameters.