Insulin/alginate (ALG) microcapsules for controllable release and side effect reduction of a glucocorticoid have been fabricated via the layer-by-layer (LbL) assembly technique. Insulin and ALG are deposited alternately onto hydrocortisone (HC) crystals to form a core shell structure. This insulin/ALG microcapsule can prolong the release of HC under physical conditions and control the HC release rate by adjusting the number of insulin/ALG bilayers adsorbed onto HC crystals. The release of insulin from the capsule wall exhibits a little lag, compared with that of the HC. It is a great advantage for this system because hyperglycemia caused by HC usually arises a few hours after its administration, which could be inhibited by the delayed release of insulin from the shell of the microcapsule. This synergy effect might enable a new way of using one carrier to deliver two kinds of drugs and reduce their side effects at the same time.