Polyelectrolyte microcapsules have been loaded with a pH-sensitive, high molecular weight SNARF-1-dextran conjugate. SNARF-1 exhibits a significant pH-dependent emission shift from green to red fluorescence under acidic and basic conditions, respectively. The unique spectral properties of the dye were maintained after the encapsulation. By investigating both human breast cancer cells and fibroblasts, we were able to follow the pH change of the local environment of SNARF-1-filled capsules during the transition from the alkaline cell medium to the acidic endosomal/lysosomal compartments. The incorporation of magnetite nanoparticles and an additional pH-insensitive fluorophore within the capsule shell resulted in a novel type of sensor system based on multifunctional polymer capsules.