Diacerein (DCN), an anti- inflammatory, anti-osteoarthritic drug having short-acting properties was formulated as microsphere following fluid bed bottom spray coating technique for sustained release drug delivery, where HPMC (6cps) and ethyl cellulose (N7) were used as coating polymers. Assay of DCN microsphere was done following HPLC method. Drug content in microsphere was found to be 147 mg g-1. Drug entrapment efficiency was calculated as 61%. SEM study of microsphere showed that microsphere was spherical in shape and porous in structure. Particle size, size distribution, zeta potential and poly disparity index were studied by dynamic light scattering method. particle size range was found between 396-615nm, zeta potential 10.8-19.6mv and PDI 0.65. In vitro drug release rate from microsphere was studied in different buffers like phosphate (pH 6.8), citrate (pH 6.0) and acidic medium (0.1N HCL). DCN microsphere released about 97% of its drug content in 20 h in phosphate buffer, 57.8% of its drug content in citrate buffer in 20 h and negligible drug release was found in acidic medium. On the contrary, market preparation of diacerein 50 mg capsule (Orcerin, Macleod’s) released 80% of its drug content in 1 h in phosphate and citrate buffer. Pharmacokinetic study of DCN microsphere vis a vis DCN capsule market preparation in plasma level of rabbit showed as Cmax4.02/3.97 mcg ,Tmax4h/ 2.67h, AUC0-t 21.26/17.80 mcg h mL-1, AUC 0-∞ 21.35/19.38 mcg h mL-1, T1/2 1.98/ 2.30 h and Kel 0.35/0.31. Study as mentioned above showed that DCN microsphere manufactured by fluid bed bottom spray coating technique using HPMC (6cps) and ethyl cellulose (N7) as coating polymers exhibited sustained release drug delivery. So it is a useful method for manufacture of sustained release dosage form.