Taxol is a marketed product for the treatment of ovarian, breast, non-small cell lung cancer and AIDS-related Kaposi's Sarcoma. It is thus far one of the most effective anticancer drugs available on the market. However, paclitaxel is only sparingly soluble in water and therefore, intravenous administration depends on the use of the non-ionic surfactant Cremophor EL (polyethoxylated castor oil) to achieve a clinically relevant concentrated solution. Unfortunately, Cremophor EL increases toxicity and leads to hypersensitivity reactions in certain individuals. We have developed a well characterized novel lyophilized liposome-based paclitaxel (LEP-ETU) formulation that is sterile, stable and easy-to-use. The mean particle size of the liposomes is about 150 nm before and after lyophilization, and the drug entrapment efficiency is greater than 90%. Stability data indicated that the lyophilized LEP-ETU was physically and chemically stable for at least 12 months at 2-8 and 25 degrees C. Moreover, the formulation can be diluted to about 0.25mg/ml without drug precipitation or change in particle size. In vitro drug release study in phosphate-buffered saline (PBS, pH 7.4) showed that less than 6% of the entrapped paclitaxel was released after 120 h, indicating that the drug is highly stable in an entrapped form at physiologic temperature.