In this article, the authors present the fabrication of an enzyme-entrapped alginate hollow fiber using a microfluidic device. Further use of enzyme-entrapped alginate hollow fibers as a biocatalytic microchemical reactor for chemical synthesis is also deliberated in this article. To ensure that there is no enzyme leaching from the fiber, fiber surfaces were coated with chitosan. To confine the mobility of reactants and products within the porous hollow fibers the entire fibers were embedded into a transparent polydimethylsiloxane (PDMS) matrix which also works as a support matrix. A vanadium-containing bromoperoxidase enzyme isolated from Corallina confusa was used as a model enzyme to demonstrate the use of these alginate hollow-fiber reactors in bromo-oxidation of phenol red to bromophenol blue at different dye flow rates. Stability of the entrapped enzyme at different temperatures and the effect of the chitosan coating on the reaction conversion were also studied. It was observed that molecules as big as 27 kDa can be retained in the matrix after coating with chitosan while molecules with molecular-weight of around 378 Da can still diffuse in and out of the matrix. The kinetic conversion rate in this microfluidic bioreactor was more than 41-fold faster when compared with the standard test-tube procedure.