Biodegradable and control led-release capsules composed of waste paper fibers as matrix and limonene droplets as core materials were prepared by utilizing the liquid-liquid dispersion. Encapsulation was performed due to coalescence between a droplets containing binder and fibers and those dissolving a gelling agent. In this experiment, methylcellulose as a binder and tannic acid as a gelling agent were used respectively. Paper fibers were treated hydrophobic prior to the encapsulation operation in order to improve waterproofing of capsules. It was investigated whether capsules could be prepared by this encapsulation process or not. Furthermore, it was investigated how the fiber concentration affected the morphology and release characteristics of capsules.As a result, it was found that capsules were able to be prepared due to coalescence between two kinds of droplets and the capsule morphology was extremely changed with the fiber concentration. Moreover, it was found that the change in morphology considerably affected the release characteristics. Namely, in the case of the lower fiber concentration, monocore-type capsule containing limonene droplets were formed. However, as the fiber concentration increased, multicore-type capsules were formed.