ABSTRACTPoly(vinyl alcohol) (PVA) hydrogels containing drug–β‐cyclodextrin inclusion complexes (ICs) were synthesized with glutaraldehyde (GA) as a crosslinker. The role of cyclodextrin (CD), the effect of the nature of drug, and the degree of crosslinking on the drug‐release process were investigated. The probable mechanism of drug release was also explored. Controlled release of the drug was achieved from the hydrogels containing the ICs. The nature of the drug, in terms of its binding efficacy with CD, played an important role. The effect of the degree of crosslinking on the release pattern was strikingly different from that in the hydrogels containing free drug and those with ICs. The role of CD in the drug‐release process was not only due to its inclusion ability but also its effect on the polymer relaxation. GA, apart from crosslinking PVA, probably interacted with the cyclodextrins and, thereby, influenced the matrix structure and the drug‐release kinetics. © 2013 Wiley Periodicals, Inc. J. Appl. Polym. Sci. 2014, 131, 40318.