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Interfacial polyelectrolyte complexation (PEC) fiber has been proposed as a biostructural unit and biological construct for tissue engineering applications, with its ability to incorporate proteins, drug molecules, DNA nanoparticles, and cells. In this study, we evaluated the biocompatibility and blood compatibility of PEC fiber in order to assess its potential for in vivo applications in tissue engineering. Although chitosan-alginate PEC fibrous scaffold was found to be thrombogenic, the blood compatibility of the scaffold could be significantly improved by incorporating a small amount of heparin in the polyelectrolyte solution during fiber formation. The platelet microparticle production and platelet adhesion on the chitosan-alginate-heparin fibrous scaffold were comparable to those on the resting control. In vitro cytotoxicity test showed that the scaffold was not toxic to human mesenchymal stem cells (hMSCs). In the in vivo biocompatibility test in rats, no acute inflammation was observed in the subcutaneously or intramuscularly implanted specimens. Good cell infiltration and vascularization were observed after 2 months of implantations. Enhanced extracellular matrix (ECM) deposition was observed when hMSCs were cultured in the transforming growth factor-β3 (TGF-β3)-encapsulated PEC fibrous scaffold in vitro, or when the TGF-β3-encapsulated PEC was implanted intramuscularly in vivo. The results showed that this versatile PEC fibrous scaffold could be used in various tissue engineering applications for its good biocompatible and blood compatible properties.