Background: Theophylline (THN), a bronchodilator with potential applications in emerging conditions like COVID-19, requires a controlled-release delivery system due to its narrow therapeutic range and short half-life. This need is particularly crucial as some existing formulations demonstrate impaired functionality. This study aims to develop a new 12-h controlled-release matrix system (CRMS) in the form of a capsule to optimize dosing intervals. Methods: CRMSs were developed using varying proportions of poloxamer 407 (P-407), stearyl alcohol (STA), and hydroxypropyl methylcellulose (HPMC) through the fusion technique. Their in vitro dissolution profiles were then compared with an FDA-approved THN drug across different pH media. The candidate formulation underwent characterization using X-ray diffraction, scanning electron microscopy, Fourier transform infrared spectroscopy, differential scanning calorimetry, and thermogravimetric analysis. Additionally, a comprehensive stability study was conducted. Results: In vitro studies showed that adjusting the concentrations of excipients effectively controlled drug release. Notably, the CRMS formulation 15 (CRMS-F15), which was composed of 30% P-407, 30% STA, and 10% HPMC, closely matched the 12 h controlled-release profile of an FDA-approved drug across various pH media. Characterization techniques verified the successful dispersion of the drug within the matrix. Furthermore, CRMS-F15 maintained a consistent controlled drug release and demonstrated stability under a range of storage conditions. Conclusions: The newly developed CRMS-F15 achieved a 12 h controlled release, comparable to its FDA-approved counterpart.