Immune rejection and scarcity of donor tissues are the restrictions of islets transplantation. In this study, the cytoprotection of chitosan hydrogels in xenogeneic islet transplantation was demonstrated. Wistar rat islets encapsulated in chitosan hydrogels were performed glucose challenge test and live/dead cell staining in vitro. Islets/chitosan hydrogels were transplanted into the renal subcapsular space of diabetic C57BL/6 mice. Non-fasting blood glucose level (NFBG), body weight, intraperitoneal glucose tolerance test (IPGTT), and glucose disappearance rate were determined perioperatively. The serum insulin level was analyzed, and the kidney transplanted with islets/chitosan hydrogels were retrieved for histological examination after sacrifice. The present results showed that islets encapsulated in chitosan hydrogels secreted insulin in response to the glucose stimulation as naked islets with higher cell survival. The NFBG of diabetic mice transplanted with islets/chitosan hydrogels decreased from 487+/-46 to 148+/-32 at one day postoperation and maintained in the range of 201+/-36 mg/dl for four weeks with an increase in body weight. IPGTT showed the glucose disappearance rate of mice transplanted with islets/chitosan hydrogels was significant faster than that of mice transplanted with naked islets; the serum insulin level increased from 0.29+/-0.06 to 1.69+/-0.65 microg/dl postoperatively. Histological examination revealed that the islets successfully engrafted at renal subcapsular space with positive insulin staining. The immunostain was negative for neither the T-cell lineages nor the monocyte/macrophages. This study indicates that the chitosan hydrogels deliver and protect encapsulated islets successfully in xenotransplantation.