Novel thermoresponsive block copolymers of poly(ethylene glycol) and polyphosphoester were synthesized, and the thermo-induced self-assembly, biocompatibility, and hydrolytic degradation behavior were studied. The block copolymers with various molecular weights and compositions were synthesized through ring-opening polymerization of 2-ethoxy-2-oxo-1,3,2-dioxaphospholane (EEP) and 2-isopropoxy-2-oxo-1,3,2-dioxaphospholane (PEP) using poly(ethylene glycol) monomethyl ether (mPEG) as the initiator and stannous octoate as the catalyst. The obtained block polymers exhibited thermo-induced self-assembly behavior, demonstrated by dynamic light scattering and UV-vis measurements using 1,6-diphenyl-1,3,5-hexatriene as the probe. It was found that the critical aggregation temperature (CAT) of the block copolymers shifted to higher temperature with increased molecular weight of mPEG, while copolymerization with more hydrophobic monomer PEP led to lower transition temperature; thus, the CAT can be conveniently adjusted. The block copolymers did not induce significant hemolysis and plasma protein precipitation. In vitro MTT and live/dead staining assays indicated they are biocompatible, and the biocompatibility was further demonstrated in vivo by the absence of local acute inflammatory response in mouse muscle following intramuscular injection. Unlike most frequently studied thermoresponsive poly(N-isopropylacrylamide), polyphosphoesters were hydrolytically degradable in aqueous solution that was proven by gel permeation chromatography and NMR analyses, and the degradation products were proven to be nontoxic to HEK293 cells. Therefore, with good biocompatibility and thermoresponsiveness, these biodegradable block copolymers of mPEG and polyphosphoesters are promising as stimuli-responsive materials for biomedical applications.