This chapter reviews recent work on the synthesis of aqueous microgel particles by precipitation polymerization. Precipitation polymerization allows flexible control over important physicochemical properties of aqueous microgels, such as size distribution, surface charge, chemical composition, and microstructure. The microgel systems discussed in this review are mainly based on poly(N-isopropyl acrylamide) and poly(N-vinylcaprolactam) due to their ability to react to external stimuli such as the pH or temperature of the surrounding medium. We discuss synthetic routes to obtain microgels based on homo-or copolymers as well as colloids with complex core-shell morphology. The functionalization of microgels is of crucial importance from the application point of view. Different routes for incorporation of functional groups, synthetic polymers, proteins, or nanoparticles in microgel structures are discussed.