The present invention is directed to a hydrogel network comprised of a physically cross-linked polymer and a chemically cross-linked polymer or physically entangled copolymer containing living cells, such as chondrocytes, encapsulated therein. In a preferred aspect, the physically cross-linked polymer is selected from the group consisting of thermally gelling polysaccharides and proteins, such as agarose or gelatin, and the chemically cross-linked or physically entangled polymer is synthesized from a water-soluble vinyl monomer, either as a homopolymer or copolymer, such as polyethylene glycol diacrylate (“PEG-DA”) and 2-hydroxyethyl methacrylate (“HEMA”).