Polyethylenimine (PEI) is one of the most efficient vectors for non-viral gene delivery, whereas its poor transfection activity, compared to viral vectors, and cytotoxicity need to be improved for in vivo applications. In this study, we prepared two PEI conjugates with 6 and 10 wt.% of poly(ethylene glycol) (PEG) grafts (referred to PEI-PEG-6 and PEI-PEG-10, respectively) in order to investigate the effects of PEGylation on cytotoxicity and transfection activity in vitro. In addition, their suitability as vectors for local gene delivery in vivo was assessed by injecting lipiodolized emulsions containing polymer/DNA complexes into the femoral artery of Sprague-Dawley (SD) rats, occluded by a surgical suture to block inflow of the blood to the leg. Both PEGylated PEIs showed significantly lower cytotoxicity and higher transfection activity in COS-1 cells than PEI taken as a control; in particular, PEI-PEG-10 produced the most promising results. The stable water-in-oil emulsion, composed of aqueous domains containing the complexes and lipiodol as an oil phase, was formed in the presence of a hydrogenated castor oil. From in vivo experiments, it was found that all the complexes, dispersed in the lipiodolized emulsion, delivered effectively gene to muscle, surrounding the injection site, rather than other organs such as liver, spleen, kidney, heart and lung. The in vivo transfection activity of PEI-PEG-10 was 3-folds higher in muscle than that of PEI. Based on these results, it can be concluded that PEGylated PEIs (based on the lipiodolized emulsion system) hold a promising potential for local gene delivery in vivo.