ABSTRACT: Nano-in-micro (NIM) system is a promising approach to enhance the performance of devices for a wide range of applications in disease treatment and tissue regeneration. In this study, polymeric nanofibre-integrated alginate (PNA) hydrogel microcapsules were designed using NIM technology. Various ratios of cryo-ground poly (lactide-co-glycolide) (PLGA) nanofibres (CPN) were incorporated into PNA hydrogel microcapsule. Electrostatic encapsulation method was used to incorporate living cells into the PNA microcapsules (~500?µm diameter). Human liver carcinoma cells, HepG2, were encapsulated into the microcapsules and their physio-chemical properties were studied. Morphology, stability, and chemical composition of the PNA microcapsules were analysed by light microscopy, fluorescent microscopy, scanning electron microscopy (SEM), Fourier-Transform Infrared spectroscopy (FTIR), and thermogravimetric analysis (TGA). The incorporation of CPN caused no significant changes in the morphology, size, and chemical structure of PNA microcapsules in cell culture media. Among four PNA microcapsule products (PNA-0, PNA-10, PNA-30, and PNA-50 with size 489?±?31?µm, 480?±?40?µm, 473?±?51?µm and 464?±?35?µm, respectively), PNA-10 showed overall suitability for HepG2 growth with high cellular metabolic activity, indicating that the 3D PNA-10 microcapsule could be suitable to maintain better vitality and liver-specific metabolic functions. Overall, this novel design of PNA microcapsule and the one-step method of cell encapsulation can be a versatile 3D NIM system for spontaneous generation of organoids with in vivo like tissue architectures, and the system can be useful for numerous biomedical applications, especially for liver tissue engineering, cell preservation, and drug toxicity study.