Azithromycin (AZT) is a broad-spectrum antibiotic and is found in ocular tis-sues when administered systemically. AZT inhibits RNA-dependent protein synthesis and hence has effective bactericidal capability against Staphylococcus aureus, Pseudomonas aeruginosa, which are the primary causative organ-isms for bacterial infection. In situ ophthalmic gels are systems which undergo a sol-to-gel transformation when instilled in eyes. In situ gels overcome the shortcoming of ophthalmic drops as they get washed out and diluted due to tear fluid. The aim and objective of present study was to formulate in situ ophthalmic gelling systems of Azt and determine in vivo ocular residence time in rat eyes of Tc99 labelled Azt by Micro SPECT. The in situ gel was formulated using Poloxamer 407, which is a temperature-induced gelling agent and HPMC K4M, which is known to increases mucosal adhesivity and enhance viscosity to facilitate sustained release of drug. The formulations developed were evalu-ated for pH, clarity, viscosity, gelling capacity and % drug release. The selected formulation was subjected to isotonicity and In Vivo Bio-distribution studies. Experimental studies on compatibility showed no interaction between poly-mers and AZT. AZT was found soluble in PB6.8. All formulations were found clear immediately after preparation and after sterilization & pH after gelation was satisfactorily in the range of 6 to 7. Viscosity and Gelation capacity of in situ gel increased with increase in polymer concentration. Formulations F2 showed desired results w.r.t viscosity, gelation capacity, drug release. In Vivo Biodistribution studies of Tc99labelled AZT by Micro SPECT showed there was a significant increase in ocular residence time of in situ gel when compared with Tc99 labelled marketed solutions.