Polymer microgels of poly(vinyl alcohol)/poly(methacrylate-co-N-isopropyl acrylamide) showed a thermoresponsive behavior, suitable for application in drug delivery (Biomacromolecules 2009, 10, 1589). In this work molecular dynamics (MD) methods were used to explain which structural aspects are determining for thermoresponsivity and how water properties in the hydrogel are influenced. Two topologically different models of the junction domain in the hydrogel at the experimental hydration degree were studied at 293 and 323 K, below and above the transition temperature. MD simulations of the corresponding oligomers of poly(N-isopropyl acrylamide) were also performed for a comparison. Simulation results provided an atomic detailed description of the temperature induced modifications in the microgel network and of water dynamics, in agreement with available experimental findings.