Drug administration via buccal mucosa is an attractive drug delivery strategy due to good patient compliance, prolonged localized drug effect, and avoidance of gastrointestinal drug metabolism and first-pass elimination. Buccal drug delivery systems need to maintain an intimate contact with the mucosa lining in the wet conditions of the oral cavity for long enough to allow drug release and absorption. For decades, mucoadhesive polymers such as chitosan (CS) and its derivatives have been explored to achieve this. In this study, inspired by the excellent wet adhesion of marine mussel adhesive protein, we developed a buccal drug delivery system using a novel catechol-functionalized CS (Cat-CS) hydrogel. We covalently bonded catechol functional groups to the backbone of CS, and crosslinked the polymer with a non-toxic crosslinker genipin (GP). We achieved two degrees of catechol conjugation (9% and 19%), forming Cat9-CS/GP and Cat19-CS/GP hydrogels, respectively. We confirmed covalent bond formation during the catechol functionalization and GP crosslinking during the gel formation. The gelation time and the mechanical properties of Cat-CS hydrogels are similar to those of CS only hydrogels. Catechol groups significantly enhanced mucoadhesion in vitro (7 out of the 10 Cat19-CS hydrogels were still in contact with porcine mucosal membrane after 6 h, whereas all of the CS hydrogels lost contact after 1.5 h). The new hydrogel systems sustained the release of lidocaine for about 3 h. In-vivo, we compared buccal patches made of Cat19-CS/GP and CS/GP adhered to rabbit buccal mucosa. We were able to detect lidocaine in the rabbit's serum at concentration about 1 ng/ml only from the Cat19-CS patch, most likely due to the intimate contact provided by mucoadhesive Cat19-CS/GP systems. No inflammation was observed on the buccal tissue in contact with any of the patches tested. These results show that the proposed catechol-modified CS hydrogel is a promising mucoadhesive and biocompatible hydrogel system for buccal drug delivery.