In this work, a low-cost and sustainable non-animal chitin from Hericium erinaceus residue was used to prepare hydrogels through a facile procedure. The chitin was firstly dissolved in NaOH/Urea aqueous solution by freeze thawing, and then the obtained chitin solution was directly regenerated to form hydrogels. The results showed that the extracted chitin could dissolve in NaOH/urea solvent system. The chitin solutions with concentrations from 1% to 4% showed no gelation behavior, while those with concentrations from 5% to 7% could form hydrogels. The obtained hydrogels showed elastic characteristic and desirable transmittance. In addition, the hydrogels with higher chitin concentration exhibited more compact gel network and improved gel strength, but decreased swelling degree and cumulative drug release. Compared with neat chitin, the thermal stability of the regenerated chitin hydrogels was also improved. The 5-Fu could be gradually released from the hydrogels, which followed Fickian diffusion model.