Graft copolymerization technique is used to enhance the application spectrum of chitosan in controlled drug release applications. Optimum grafting reaction conditions were evaluated for grafting of acrylic acid onto chitosan by using potassium persulphate as free radical initiator in aqueous solution. Glycidyl methacrylate was grafted for five different concentrations using the optimum grafting conditions evaluated for acrylic acid alone onto chitosan. Characterization techniques like FTIR, DSC, XRD and SEM were used to give chemico-physical evidences of grafting. The swelling behaviour of chitosan and graft copolymers were studied as a function of pH for defining their end use in the controlled release of anti-inflammatory drug, Diclofenac sodium.