To investigate the effects of polymer chemistry and topology (linear or graft copolymer) on in vivo biocompatibility and biostability based on cage implant system, various hydrogels, composed of short hydrophilic [polyethylene oxide (PEO)] and hydrophobic block, were prepared by polycondensation reaction. Poly(tetramethylene oxide) (PTMO) or poly(dimethyl siloxane) (PDMS) was chosen as a hydrophobic block because of their wide utilization as a biomaterial. By using the specimens retrieved from rats killed after 1, 2, 3, 5, and 7 weeks' implantation, cellular and material responses were assessed. Most hydrogels showed a comparable value of macrophage density to Pellethane(R), control polymer, whereas they did significantly lower foreign body giant cell (FBGC) density and coverage because of the presence of PEO. However, PEO block length and polymer topology did not affect macrophage adhesion and FBGC formation in our polymer composition. The hydrogel based on PDMS alone showed significantly lower macrophage density and FBGC density than Pellethane(R), indicating that PDMS plays a role in inhibiting cellular adhesion. The results obtained from gel permeation chromatography curve and Fourier transform infrared spectra exhibited that all the polymers were susceptible to oxidative degradation in vivo. Although Pellethane(R) revealed surface degradation by 5 weeks in vivo, hydrogels showed rapid degradation in the bulk within 2 weeks because of the penetration of oxidative chemicals released from phagocytic cells into PEO domain of phase-separated hydrogels. The more significant degradation was observed in the hydrogels with longer PEO block and PTMO as a hydrophobic block instead of PDMS. It was evident that the minor degradation could be achieved by grafting PEO and adopting PDMS as a hydrophobic block in the hydrogel.