Functionalized alginate microbeads (MB) have been widely used for three-dimensional (3D) culture of cells and creating biomimetic tissue models. However, conventional methods for preparing these MB suffer from poor polydispersity, due to coalescence of droplets during the gelation process and post-aggregation. It remains an immense challenge to prepare alginate MB with narrow size distribution and uniform shape, especially when their diameters are similar to the size of cells. In this work, we developed a simple method to produce monodispersed, cell-size alginate MB through microfluidic emulsification, followed by a controlled shrinkage process and gelation in mineral oil with low concentration of calcium ion (Ca2+). During the gelation process caused by the diffusion of Ca2+ from the oil to water phase, a large amount of satellite droplets with sub-micrometer sizes was formed at the water/oil interface. As a result, each original droplet was transformed to one shrunken-MB with much smaller size and numerous submicron-size satellites. To explore the feasibility of the shrunken-MB for culturing with cells, we have successfully modified a variety of polymer nanofilms on MB surfaces using a layer-by-layer assembly approach. Finally, the nanofilm-modified MB was applied to a 3D culture of GFP-expressing fibroblast cells and demonstrated good biocompatibility.