A polymer blend is prepared by dissolving chitosan and a second polymer in an acidic aqueous solution to form an aqueous polymer blend, dehydrating said aqueous polymer blend, and recovering said polymer blend. The second polymer may be selected from the group consisting of polyether glycols including polyethylene glycols; cellulose esters including cellulose acetate; poloxamers; polysaccharides including dextran and guar; polyvinylpyrrolidones; polyvinyl alcohols; and mixtures or copolymers thereof. These polymer blends swell in an acidic environment and deswell in a more neutral or basic environment. This technology is valuable for the dispensing of biologically active material or drugs into a surrounding environment, especially the environment as is found in the gastrointestinal tract. Since the various polymer blends of the present invention are not covalently or ionically crosslinked, but are physically combined, each polymer in the physical blend maintains its original chemical structure, and therefore, is safe for oral administration.