The treatment of breast cancer requires long chemotherapy management, which is accompanied by severe side effects. Localized delivery of anticancer drugs helps to increase the drug concentration at the site of action and overcome such a problem. In the present study, chitosan hydrogel was prepared for local delivery of 5-Fluorouracil. The in vitro release behavior was investigated and the anticancer activity was evaluated against MCF-7 cells using MTT assay. The in vivo studies were investigated via intra-tumoral injection of a 5-FU loaded hydrogel into breast cancer of female rats. The results indicated that the modified hydrogel has excellent physicochemical properties with a sustained in vitro release profile matching a zero-order kinetic for one month. In addition, the hydrogel showed superior inhibition of cell viability compared with the untreated control group. Moreover, the in vivo studies resulted in antitumor activity with minor side effects. The tumor volume and level of tumor markers in blood were inhibited significantly by applying the hydrogel compared with the untreated control group. In conclusion, the designed injectable hydrogels are potential drug delivery systems for the treatment of breast cancer with a controlled drug release profile, which could be suitable for decreasing the side effects of chemotherapy agents.