The purpose of this work is to study the ability of a new biodegradable polyurethane PU(TEG-HMDI) obtained by reaction of triethylene glycol (TEG) with 1,6-hexamethylene diisocyanate (HMDI) to act as matrix forming polymer for controlled release tablets and to estimate its percolation threshold in a matrix system. Matrix tablets weighing 250 mg were prepared by direct compression with 10-30% wt/wt of PU(TEG-HMDI) and anhydrous theophylline as model drug. Release studies were carried out using the paddle method. The results were analyzed using the kinetics models of Higuchi, Korsmeyer-Peppas, and Peppas and Sahlin. These studies confirm the existence of an excipient percolation threshold between 10 and 20 % wt/wt of PU(TEG-HMDI) for the different batches prepared. It has been observed that the new biodegradable polyurethane PU(TEG-HMDI) shows adequate compatibility as well as a high ability to control the drug release.