In order to prepare and apply the polyvinyl alcohol/drug-loaded chitosan microspheres composite wound dressing, we first prepared chitosan microspheres by emulsion cross-linking method, and then added chitosan microspheres into the reactants during the acetalization of polyvinyl alcohol and formaldehyde. We further studied the morphology, water absorption, swelling degree, mechanical properties and in vitro release of the sponge with different amount of chitosan microspheres. The results showed that polyvinyl alcohol/drug-loaded chitosan composite sponge has porous structure with connectionism. Increasing the amount of chitosan microspheres would make the apertures smaller, so that the water absorption and the swelling of sponge decreased, but the tensile strength and compressive strength increased. With the increase of the amount of chitosan microspheres, the drug absorption of cefradine and the release rate increase, and the release time become longer. With the results of toxicity grade of 0 to 1, this type of composite sponge is non-toxic and meets the requirement of biocompatibility. The observation of rabbit nasal cavity after surgical operation suggested that polyvinyl acetal sponge modified with the chitosan has antiphlogistic, hemostatic and non-adherent characteristic, and can promote the healing and recovering of the nasalmucosa. After using this composite material, best growing surroundings for patients' granulation tissue were provided. Exposed bone and tendon were covered well with granulation tissue.