In this work, a biodegradable and injectable in situ gel-forming controlled drug delivery system based on thermosensitive poly(epsilon-caprolactone)-poly(ethylene glycol)-poly(epsilon-caprolactone) (PCEC) hydrogel was studied. The prepared PCEC hydrogel undergoes temperature-dependent sol-gel-sol transition, which is a flowing sol at ambient temperature and turns into a non-flowing gel at around physiological body temperature. Furthermore, the sol-gel phase transition mechanism was investigated using (13)C-nuclear magnetic resonance imaging and a laser diffraction particle size analyzer. The in vitro release behaviors of several model drugs, including a hydrophilic small-molecule drug, a hydrophobic small-molecule drug and a macromolecular protein drug, from PCEC hydrogel were also investigated in detail. The results showed that the model drugs could be released from the PCEC hydrogel system over a sustained period. In addition, an anaesthesia assay was conducted using the tail flick latency (TFL) test to evaluate the in vivo controlled drug delivery effect of the PCEC hydrogel system. In the TFL assay, a lidocaine-loaded PCEC hydrogel produced significantly longer-lasting local anaesthetic effects compared with lidocaine aqueous solution at the same dose. Therefore, PCEC hydrogel is promising for use as an injectable local drug delivery system.