The objective of this study was the preparation and characterization of a sustained-release matrix tablet containing a high-dose hydrophobic drug and its comparison with marketed products. In the present study, HPMC was applied as the matrix-forming polymer for the sustained release of clarithromycin (500 mg). The compatibility of clarithromycin and excipients was studied using a binary mixture approach and compatible excipients were selected. Matrix tablets were prepared using the high-shear wet granulation technique. Tablets were compressed using oblong (19 mm), shallow concave punches, under a compression weight of 900 mg/tablet. The flow of granules was evaluated by determining their bulk density, tapped density, angle of repose, Hausner ratio, and Car’s index. Compressed tablets were tested for their physical parameters, mechanical characteristics, drug content, and in vitro drug release, as per United States Pharmacopeia (USP). Clarithromycin is a drug having poor water solubility and showed compatibility with all the excipients used in the formulation of polymeric matrix tablets. FTIR spectra of clarithromycin, before and after being subjected to the stress conditions, confirmed the compatibility of clarithromycin and other ingredients of the matrix tablets. All the formulations exhibited good rheological characteristics and all the parameters related to flow showed results in the acceptable range. Physically, matrix tablets were smooth and shiny, without any surface defects. Weight variation (±5%) and drug content of the tablets (95–102%) were within the pharmacopeial limits. HPMC successfully sustained the drug release for 24 h. It is concluded from the study that dissolution rate of clarithromycin can be sustained using hydrophilic polymer (HPMC) as a release-controlling agent.