Objective To introduce the research update of microencapsulation and its application in orthopedics. Methods Recent articlesconcerned were extensively reviewed. Results Drugs and cells modified by genecould be encapsulated in different materials and be implanted in vivo avoiding a host immune system rejection. It act as a continuous source of desired medicine for enhancement of bone healing, the treatment of bone tumor and bone infection, and the regeneration of bone and cartilage. Conclusion Microencapsulation can be used asa carrier for drugs and cells modified gene to treat related disease in orthopedics.