The article describes the design of the multicomponent hydrogel system of poly(acrylic acid-HEMA)/gelatin for tissue engineering application. Derivative of polycaprolactone-diol (polycaprolactone diacrylate (PCL-DAr)) was used to cross-link acrylate monomers whereas gelatin was kept free for cell proliferation. Epigallocatechin gallate (EGCG), an anti-oxidant phytochemical, was loaded by diffusion method. Its in vitro release study in PBS (pH 6.5) at 37 ± 0.2°C (75 rpm) revealed a sustained release profile upto 20 days. Fitting of drug release data in Korsmeyer-Peppas model equation revealed probable release mechanism through the value of release coefficient (n), which was found to depend on formulations composition. Drug-polymer interaction, thermal behavior, and surface morphology were investigated by attenuated total reflectance-Fourier transform infrared (ATR-FTIR) spectroscopy, thermogravimetric analysis (TGA), and scanning electron microscopic (SEM). Swelling behavior of hydrogel in PBS (pH 6.5 and 7.4, 0.2 M) and in distilled water was found to increase with increasing AAc/HEMA ratio. Compression modulus decreased from 203 ± 3.7 KPa to 11.6 ± 1.1KPa, at 30% strain, whereas displacement values significantly increased from 3.2 ± 0.2 to 4.7 ± 0.6 mm at 20 N force (p < 0.05), with increasing AAc/HEMA ratio. Percentage cell viability was analyzed using indirect 3-[4, 5-dimethylthiazolyl-2]-2,5-diphenyltetrazo-liumbromide (MTT) assay with fibroblast L929 cells; showed ≥92.3% cell viability after 24 h incubation. Cell proliferation on the scaffold surface was found to increase with incorporation of HEMA in P(AAc)/G cross-linked hydrogel matrix upto a certain extent. These biocompatible, elastic, and swellable hydrogels can serve as a matrix for drug delivery and tissue engineering applications.