Gemcitabine [2', 2'-difluoro-2'-deoxycytidine (dFdC)] is a low molecular weight, deoxycytidine analog inhibiting cellular DNA synthesis. Currently, it is the frontline drug approved by Food and Drug Administration (FDA) for the treatment of pancreatic cancer. However, efforts to use gemcitabine as an anti-cancer agent have been limited by its short circulation time and rapid metabolism that reflects in low tumor uptake and intracellular action. Polymer-drug conjugates, in this regard have spawned an approach to improve the cytotoxicity efficiency and bioavailability of gemcitabine by chemical modification. The present study describes the synthesis of a water soluble formulation of PEGylated gemcitabine characterized by FT IR, (1)H NMR and RP-HPLC chromatography. The PEGylated gemcitabine has a prolonged circulation time in plasma as studied in an animal model. This eventually caused a marked improvement in the cytotoxicity and apoptosis-inducing activity in pancreatic cancer cell lines (MIA PaCa 2 and PANC 1). Hence, these findings demonstrate the PEGylated gemcitabine is a desirable approach for therapy by intravenous administration. Successful clinical application of this approach can significantly contribute to the treatment of pancreatic cancer.