PEG-b-PNIPAM block copolymers are synthesized by the atom transfer radical polymerization of NIPAM using PEG macro-initiator. When the polymerization temperature is 25 degrees C, the block copolymer is soluble in water, whereas the block copolymer is phase-separated to form micelles during polymerization as the polymerization temperature is raised to 50 degrees C, the temperature above the LCST of PEG-b-PNIPAM. To prepare stable hydrogel nanoparticles in water at room temperature, a small amount of N,N-t-ethylenebisacrylamide is added as a cross-linker to the reaction system, where the size of nanoparticles is controlled by the composition of mixed solvent. (c) 2005 Elsevier Ltd. All rights reserved.