Cell and tissue behavior can be controlled by explicit design criteria for the cellular microenvironment. The microenvironment surrounding cells in developing systems directs their decisions to proliferate, differentiate, migrate, or undergo morphogenesis. In addition, groups of cells, such as epithelial sheets, respond to microenvironmental cues by generating an organized response, such as forming a blood vessel. Three-dimensional biodegradable scaffolds can be engineered from biomaterials to mimic the cellular microenvironment and induce tissue formation. Diffusible growth factors or extracellular matrix molecules can be delivered to cells in a controlled manner via scaffolds for 3-D tissue engineering. Hydrogels can be used as scaffolding materials owing to their high water content, biocompatibility and the similarity of their mechanical properties to natural tissues. Microscale technologies serve multiple purposes in cell-microenvironment studies. The effect of micromechanical and chemical signals, in addition to genetic perturbations, can be determined. Furthermore, miniaturization of experimental manipulations enables parallel analysis of multiple conditions and increased throughput. In addition, complex reconstitutions of multiple cell types and materials are possible in a 3-D microenvironment.