Hydrogel microparticles (HMPs) are promising for biomedical applications, ranging from the therapeutic delivery of cells and drugs to the production of scaffolds for tissue repair and bioinks for 3D printing. Biologics (cells and drugs) can be encapsulated into HMPs of predefined shapes and sizes using a variety of fabrication techniques (batch emulsion, microfluidics, lithography, electrohydrodynamic spraying and mechanical fragmentation). HMPs can be formulated in suspensions to deliver therapeutics, as aggregates of particles (granular hydrogels) to form microporous scaffolds that promote cell infiltration or embedded within a bulk hydrogel to obtain multiscale behaviours. HMP suspensions and granular hydrogels can be injected for minimally invasive delivery of biologics, and they exhibit modular properties when comprised of mixtures of distinct HMP populations. In this Review, we discuss the techniques that are available for fabricating HMPs, as well as the multiscale behaviours of HMP systems and their functional properties, highlighting their advantages over traditional bulk hydrogels. Furthermore, we discuss applications of HMPs in the fields of cell delivery, drug delivery, scaffold design and biofabrication.