Curcumin possesses numerous medicinal benefits including anti-cancer and anti-viral properties. However, its wide scale use as a drug is often hindered owing to the dearth of suitable drug-delivery systems which can solubilise it for long-term sustained-release and safeguard its beneficial properties. In this work, a fast, one-step method, employing evaporation induced assembly of colloids, has been employed for the synthesis of curcumin encapsulated organic-inorganic hybrid micron-sized spheres. Detailed physical properties of the microspheres, with scaffolds of silica nanoparticles (~8.5 nm) cross linked by chitosan, are studied to trace the underlying mechanism of structural assembly in such systems, by tuning the polymer matrix with solubilizing agents, DMSO and Tween 20. A systematic modification in the hydrogen bonding network, conformations and interactions between macromolecules is revealed upon tuning the organic matrix. This in turn is found to control the assembly vis-`a-vis the granular morphology, drug entrapment and packing fraction of nanoparticles in the microspheres, which have direct influence on the biological properties. Consequently, the microspheres are found to follow a first order drug release kinetics with a tunable rate constant which follows the ordering of packing fraction of silica nanoparticles in the micro-granules. A sustained curcumin release for a period extending up to 24 h has been achieved. Further studies using human lung and cervical cancer cell lines assert good anti-cancer properties of these nanostructured microspheres in cancer cells, while showing no toxicity towards normal cells. Thus, such hybrid organic-inorganic formulations achieved using multi-component colloidal assembly approach, with enhanced stability against degradation, are promising candidates for future clinical applications of waterinsoluble drugs.