In this paper, we prepared composite fibers via electrospinning from either W/O or O/W emulsion. SEM images demonstrate the beads-in-string structures in these fibers and proved this technique to be an effective method for microencapsulation. As a practical application, Ca-alginate microspheres, which serve as reservoirs for hydrophilic drugs, were prepared in a reverse emulsion and then incorporated into poly (L-lactic acid) (PLLA) fibers by electrospinning. With the bovine serum albumin (BSA) loaded into the microspheres, the beads-in-string structure thus entrapped hydrophilic proteins in hydrophobic polymeric matrix. In the in vitro release test, BSA, which was released from composite fibers, achieved prolonged release profiles and lower burst release rates than those from naked Ca-alginate microspheres. In comparison with other well-established techniques to prepare microcapsules, such as solvent evaporation and spray-drying techniques, emulsion electrospinning features partly competing, partly complementary characteristics. Extension to other emulsion systems will be able to fabricate new types of functional structures.