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Background: Chitosan is a natural polymer which has limited solubility. Chitosan is capable of being modified using multiple alternatives for chitosan chemical modifications that provide different desirable properties. Method: N-methyl chitosan was successfully prepared and characterized. N-methyl chitosan was characterized by the FTIR, XRD, SEM, TEM, solubility, water content, and specific surface area. Antifungal activity against Candida albicans of N-methyl chitosan and gauze coated N-methyl Chitosan were also determined in this study. The antifungal activity tests were performed using agar diffusion and broth microdilution methods. Gauze coating with N-methyl chitosan was performed with a pad-dry-cure method. The SEM photograph of N-methyl chitosan clearly showed the rugged nature of particles. The TEM image shows that N-methyl chitosan produced from synthesis possessed round shape, with an average diameter of 50 nm. Results: The results of solubility in water, water content, and specific surface of N-methyl chitosan were 2.04 mg/mL, 18.12%, and 0.995 m2/g, respectively. Conclusion: N-methyl chitosan exhibited antifungal activity against C. albicans with MIC and MFC 0.75% and 1%, respectively. The maximum clear zone produced by gauze coated N-methyl chitosan occurred at 1% concentration of N-methyl chitosan, 60 seconds of dipping time, and 10 times of dipping frequency.