The combination of multipotent mesenchymal stromal cells (MSCs) and different biomaterials has led to enormous advances in cell-based therapies, among which cell microencapsulation technologies are included. In the present work, we have studied the influence of different cell densities on the behavior of erythropoietin (EPO)-secreting MSCs immobilized in alginate microcapsules for their use as drug delivery systems. In vitro studies showed a more sustained and controlled EPO-secretion in groups with higher cell densities, which may be related to a more balanced renewal of the encapsulated cells, while low and intermediate densities gave rise to a continuous increase of both the number of cells and the EPO secretion levels. However, in vivo studies depicted a completely different scenario. Here the higher levels of cell proliferation led to a rapid space saturation and oxygen depletion of the capsule core, which eventually resulted in implant failure for the highest cell loads. On the contrary, lower cell densities showed a longer lasting release with a steadily increasing secretion profile. In conclusion, these results demonstrate how the final outcome of a cell-based drug delivery system may be tuned by just modifying the initial cell load, always taking into account the surrounding microenvironment.