Two types of biodegradable polyurethanes (PUs) were synthesized from methylene di-p-phenyl-diisocyanate (MDI), polycaprolactone diol (PCL-diol), and chain extenders of either butanediol (BD) or 2,2'-(methylimino)diethanol (MIDE). The effects of two types of chain extenders on the degradation, mechanical properties, hydrophilicity, and cytophilicity of PUs were evaluated. In vitro degradation studies showed that PU containing MIDE has a higher degradation rate than PU synthesized using BD as a chain extender. Mechanical testing on dry and wet samples demonstrated that PU containing MIDE has a much higher elongation in the elastic region than PU containing BD. PU containing MIDE is more hydrophilic and retains more liquid during in vitro culture. Furthermore, preliminary cytocompatibility studies showed that both types of degradable PU are nontoxic, and fibroblasts adhere better and proliferate faster on MIDE containing PU than BD containing PU. To compare the cytocompatibility and degradation behaviors of the synthesized PU with existing FDA approved biocompatible material, polylactide (PLA), with a similar degradation rate, was used as negative control. Two types of PU were shown to have similar cytocompatibility and degradation behaviors as those of the PLA material. To verify the effectiveness of the cytotoxicity assay, latex was used as a positive control. Latex samples showed toxicity to cultured cells as expected. In conclusion, by changing the type of chain extender used during the synthesis of degradable PUs, the degradation rate, mechanical properties, hydrophilicity, and cytophilicity can be adjusted for different tissue engineering applications.