Core-shell hydrogel nanocomposite was fabricated by encapsulating a silica-gold nanoshell (SGNS) with poly(N-isopropylacrylamide-co-acrylic acid) (PNIPAM-co-AAc) copolymer. The oleylamine-functionalized SGNS was used as a nanotemplate for the shell-layer growth of hydrogel copolymer. APS (ammonium persulfate) was used as a polymerization initiator to produce a hydrogel-encapsulated SGNS (H-SGNS). The amounts of NIPAM (N-isopropylacrylamide) monomers were optimized to reproduce the hydrogel-encapsulated SGNS. The shell-layer thickness was increased with the increase of polymerization time and no further increase in the shell-layer thickness was clearly observed over 16 h. H-SGNS exhibited the systematic changes of particle size corresponding to the variation of pH and temperature, which was originated from hydrogen-bonding interaction between PNIPAM amide groups and water, as well as electrostatic forces attributed by the ionization of carboxylic groups in acrylic acid.