In this paper, amine-functionalized polyacrylamide nanogels (PAm-NH2) loaded with docetaxel (DTX) were evaluated as a mucoadhesive and sustained intravesical drug delivery (IDD) system for potential bladder cancer therapy. Nanogels have not been applied for such therapy before. The mucoadhesiveness of the PAm-NH2 nanogels, which is a critical factor for IDD application, was investigated using the mucin-particle method and by analyzing the direct attachment of the PAm-NH2 nanogels onto the luminal surface of porcine urinary bladder. DTX, as a model hydrophobic drug, was successfully loaded into hydrophilic PAm-NH2 nanogels with high loading efficiency (>90%), and sustained release of DTX from the nanogels over 9 days in artificial urine was achieved. The nanogels were also taken in by bladder cancer cells in a concentration-dependent manner. The efficiency of the DTX-loaded nanogels in killing UMUC3 and T24 bladder cancer cells was determined to be equivalent to free DTX, and the morphology of the bladder urothelium was not adversely altered by the PAm-NH2 nanogels. These findings indicate that such mucoadhesive nanogels are potentially a promising candidate for intravesical delivery of hydrophobic drugs in bladder cancer therapy.