Nanocapsules are disclosed which comprise (a) a drug-containing core and (b) a polyelectrolyte multilayer encapsulating the drug-containing core. The nanocapsules include particles whose largest dimension typically ranges between 50 nm to 10000 nm. In some embodiments, the nanocapsules contain a single drug. In others, the nanocapsules contain multiple drugs, either within the same nanocapsules or within separate populations of nanocapsules. In some embodiments, the nanocapsules comprise surfaces that are functionalized, for example, with ligands that allow for attachment to bodily tissue. In some embodiments of the present invention, the nanocapsules are rendered magnetic or are rendered susceptible to magnetic fields. Also disclosed is a drug delivery method that comprises the steps of (a) providing nanocapsules such as those above; and (b) placing the nanocapsules at a desired location within the body of a subject using an implantable or insertable medical device.