Degradable polyethylene glycol (PEG) hydrogels are excellent vehicles for sustained drug release due to their biocompatibility, tunable physical properties, and customizable degradation. However, protein therapeutics are unstable under physiological conditions and releasing degraded or inactive therapeutics can induce immunogenic effects. While controlling protein release from PEG hydrogels has been extensively investigated, few studies have detailed protein stability long-term or under stress conditions. Here, lysozyme and alcohol dehydrogenase (ADH) stability were explored upon encapsulation in PEG hydrogels formed through Michael-type addition. The stability and structure of the two model proteins were monitored by measuring the free energy of unfolding and fluoresce quenching when confined in a hydrogel and compared to PEG solution and buffer. Hydrogels destabilized lysozyme structure at low denaturant concentrations but prevented complete unfolding at high concentrations. ADH was stabilized as the confining mesh size approached the protein radius of gyration. Both proteins retained enzymatic activity within the hydrogels under stress conditions, including denaturant, high temperature, and agitation. Conjugation between lysozyme and PEG-acrylate was identified at long reaction times but no conjugation was observed in the time required for complete gelation. Studies of protein stability in PEG hydrogels, as the one detailed here, can lead to designer technologies for the improved formulation, storage, and delivery of protein therapeutics.