Chitosan and its derivatives have emerged as promising gene-delivery vehicles because of their capability to form polyplexes with plasmid DNA and enhance its transport across cellular membranes through endocytosis. Evidently, polyplexes of chitosan and DNA significantly improve transfection efficiency; however, these polyplexes are not capable of sustained DNA release and, thus, prolong gene transfer. In order to achieve prolonged delivery of DNA/chitosan polyplexes, we have formulated microspheres by physically combining poly(ethylene glycol)-grafted chitosan (PEG-g-CHN) with poly(lactide-co-glycolide) (PLGA) using a modified conventional in-emulsion solvent evaporation method. Electrophoretic analysis of materials released from these microspheres suggests the presence of PEG-g-CHN complexed DNA and these microspheres are capable of sustained release of DNA/PEG-g-CHN for at least 9 weeks. The rate of DNA release can be modulated by varying the amount of PEG-g-CHN. The release products from these microspheres are bioactive and show enhanced transfection in vitro over DNA released from conventional PLGA microspheres containing no PEG-g-CHN. In vivo experiments also show that these microspheres are capable of achieving gene transfer in a rat hind limb muscle model.