In this study, we investigated the effect of the microenvironment provided by alginate-poly-l-lysine-alginate (APA) microcapsule with liquefied or gelled core on the proliferation, viability, and metabolism of human cells, including anchorage-dependent MCF-7 breast cancer cells and primary fibroblasts, and anchorage-independent K-562 leukemia cells; cells in conventional culture were used as control. The growth pattern of cells in microcapsule was examined by phase-contrast micrography. The cell viability, proliferation, organization, and gene expression were evaluated by 3-(4,5-dimethylthiazol-2-yl)-2,5-diphenyl tetrazolium bromide assay, hematoxylin and eosin staining, live/dead staining, 5-bromo-20-deoxyuridine labeling, and immunohistochemistry, respectively. Cell metabolism was determined by measuring glucose and lactate concentrations in medium. The results demonstrate that APA microcapsule with liquefied core provides a microenvironment for both anchorage-dependent and anchorage-independent cells to grow into a large cell aggregate and maintain cell viability at a constant level for a period of time. In conclusion, cells in APA microcapsule are alive and have proliferation potential with lower metabolism rate. APA microcapsule may be a useful tool for in vitro tumor cell modeling and anticancer drug screening as well as for cancer gene therapy. In addition, it lays a solid foundation for the use of microencapsulation in cell culture in vitro and cell implantation in vivo.