Multi-unit dosage forms are becoming popular for providing sustain release of drugs in the gastrointestinal (GI) tract as they diminish chances of dose dumping. They usually consist of a drug entrapped in a sustaining matrix or of a drug coated reservoir with a low permeability coating material film. Pellets are one of the multi-unit delivery system and are prepared to obtain sustained drug delivery, to improve bioavailability or stability and to target drug to specific sites. Metoprolol tartarate was used as tracer and transformed into pellets by drug layering technique. Lipids are the materials which can be used to coat the drug in order to control the release. Application of fine layer of coating material in molten state over the substrate is known as hot-melt coating technique. Bees wax and cetyl alcohol are hydrophobic excipients used as a rate-controlling membrane to modulate the drug release from dosage forms. Coating conditions (temperature, speed of pan rotation, air pressure, etc.) were investigated for the production of modified release pellets and dissolution kinetic curves were discussed. The optimized conditions confirm previous work, underscoring the considerable importance of the temperature of molten coating materials and the air pressures. Results reveal that, surface adhesion of coating excipients over pellets was controlled and consistent. The coating was uniform under controlled conditions and drug release from coated pellets was directly proportional to amount of coating excipients. Formulations stored for stability study were found to be stable during course of study as per ICH guidelines.