In this paper, we experimentally study the deformation and break-up of a micron-sized polydimethylsiloxane drop in a refractive-index-matched suspension of polymethylmethacrylate particles undergoing a planar hyperbolic flow. The particles produce both short-ranged stochastic effects and macroscopic mean-field effects on the deformation and break-up of the drops. In our experiments, the relative influence of these effects was varied by changing the particle to drop-size ratio (d(p)/d). At small d(p)/d, the mean-field effects dominate and the drop deformation and break-up are only influenced by an increased effective viscosity of the suspension. At large d(p)/d, the local flow fluctuations and the direct interactions with particles have the dominant effect on drop dynamics. This leads to pronounced fluctuations in the drop deformation and a higher polydispersity in the drop size after break-up. (c) 2010 The Society of Rheology. [DOI: 10.1122/1.3462306]