A model system for encapsulation of pancreatic islets which has potential properties for improving biocompatibility and immunosuppression was investigated. In vitro and in vivo studies have shown that phosphorylcholine-containing polymers have high biocompatibility due to low adsorption of proteins and reduced thrombus formation. Encapsulation of islets isolated from rats with a compound membrane composed of phosphorylcholine-containing polymers and cellulose acetate led to rapid insulin production and diffusion across the membrane in response to glucose challenge. The phosphorylcholine-containing polymer had a molecular weight of about 1.3 x 10(4) Da. The polymer-coated membrane excluded larger molecules such as IgG (molecular weight 150 kDa), thereby acting as a physical immuno-barrier, but allowed smaller molecules such as glucose and insulin to pass through.