We have previously optimized the internal phase separation process to give rise to aqueous core microcapsules with polymeric shells composed of poly(lactide-co-glycolide) (PLGA) or poly(lactide) (PLA). In this study, the ability of these microcapsules to act as controlled release platforms of the model hydrophilic drug phenobarbital sodium was tested. Furthermore, the effect of the initial amounts of drug and water added to the system during microcapsule synthesis was investigated. Finally, the effect of varying polymer properties such as end functionalities, molecular weights, and lactide to glycolide ratios, on the characteristics of the produced microcapsules was studied. This was done by utilizing seven different grades of the polyester polymers. It was demonstrated that, within certain limits, drug loading is nearly proportional to the initial amounts of drug and water. Furthermore, drug encapsulation studies demonstrated that ester termination and increases in polymeric molecular weight result in lower drug loading and encapsulation efficiency. Moreover, drug release studies demonstrated that ester termination, increases in molecular weight, and increases in the lactide to glycolide ratio all result in slower drug release; this grants the ability to tailor the drug release duration from a few days to several weeks. In conclusion, such minor variations in polymer characteristics and formulation composition can result in dramatic changes in the properties of the produced microcapsules. These changes can be fine-tuned to obtain desirable long-acting microcapsules capable of encapsulating a variety of hydrophilic drugs which can be used in a wide range of applications.