An improved internal gelation approach is developed to encapsulate single mammalian cells in monodisperse alginate microbeads as small as 26 mu m in diameter and at rates of up to 1 kHz with high cell viability. The cell damage resulting from contact with calcium carbonate nanoparticles as gelation reagents is eliminated by employing a co-flow microfluidic device, and the cell exposure to low pH is minimized by a chemically balanced off-chip gelation step. These modifications significantly improve the viability of cells encapsulated in gelled alginate particles. Two different mammalian cell types are encapsulated with viability of over 84 %. The cells are functional and continue to grow inside the microparticles.