Dialdehyde-terminated PEG (PEG-CHO) and adipic dihydrazide-modified alginate (ALG-ADH) was developed to provide aldehyde and hydrazide active sites, respectively, and thus to obtain dynamic acylhydrazone bonds, which endow alginate hydrogel with excellent self-healing property. Different concentrations of cross-linking agent have been added, and their influence on the structure, morphology, mechanical properties and self-healing performance has been evaluated. The gelation kinetics, shear performance and compressive property have been investigated in detail. The hydrogel with 5% cross-linking agent exhibited the highest mechanical performance, with the shear modulus of 0.234MPa and compressive modulus of 0.288MPa. Due to dynamic acylhydrazone and multiple hydrogen bonds, the hydrogels have demonstrated excellent self-healing properties. After self-healing process, the hydrogel has retained 84.4% of the original tensile modulus. The as-prepared alginate hydrogel was molded into different shapes to exhibit the excellent plasticity. Moreover, when tetracycline hydrochloride was loaded into the hydrogel system as a model drug, the modified alginate hydrogel demonstrated the fastest drug release rate at pH=7.4. It is suggested that the self-healing alginate hydrogel has a great potential in drug delivery, such as targeted drug release in intestinal treatment.