The present study was carried out to develop oral sustained release tablets of propranolol HCl by different ratios of drug : matrix. Tablets were prepared by direct compression technique using xanthan gum and lactose. All the formulations (tablets) were evaluated for thickness, diameter, hardness, friability, weight variation, content of active ingredient, in vitro dissolution using USP dissolution apparatus-II and swelling index. In case of dissolution, an inverse relationship was noted between amount of xanthan gum and release rate of propranolol HCl and the drug release was gradually enhanced as the amount of the lactose increased. The direct release was observed between swelling index and xanthan gum concentration. Significant difference in different media was observed in release profile, indicating that propranolol HCl has better solubility in HCl buffer pH 1.2. Moreover, dissolution data at differing stirring speeds was also analyzed, indicating that the drug release profile was at 50 rpm comparative to 100 rpm. The kinetic treatment showed the best fitted different mathematical models (zero order, first order, Higuchi's, Hixson-Crowell and Korsmeyer Peppas model. Most of the formulations showed linearity in Higuchi's model. The drug release from these tablets was by Fickian diffusion and anomalous (non-Fickian) mechanisms.