In this study, once-daily, sustained-release matrix tablets of tolterodine l-tartrate (TOL) for treatment of overactive bladder (OAB) were prepared by direct compression using various amounts of hydrophilic polymers such as HPMC 2910 and HPMC 2208 along with other tablet excipients; the tablets were then coated. In vitro dissolution studies were carried out under different pH conditions. The dissolution data were fitted into zero-order, first-order, Higuchi and Korsemeyer–Peppas models to identify the pharmacokinetics and mechanism of drug release. Among the four formulations (F1–F4), the dissolution profiles of formulation F2 were most similar to the marketed product with similarity and difference factors of 70.25 and 1.59 respectively. Furthermore, pharmacokinetic studies were carried out in healthy human volunteers after oral administration of the prepared TOL sustained-release matrix-coated tablet and the marketed product. The results revealed that the pharmacokinetic parameters of AUC, C_max, T_max, t_1/2, K_el, and MRT of TOL for the developed formulation (F2) were not significantly different from that for the marketed product, suggesting that they were bioequivalent. Therefore, the developed sustained-release tablet formulation of TOL could be an alternative dosage form to the SR capsule for treatment of OAB.