Altered pharmacokinetics of liposomal formulations of drugs can diminish toxicity and allow the administration of the encapsulated drug at high doses. The liposomal formulation of daunorubicin (DaunoXome, L-DNR) has been reported to produce high mean area under the plasma curve (AUC) levels due to a slow distribution of the liposomal moiety into the body and also to reduce the conversion of daunorubicin to the toxic, but inactive, daunorubicinol. Animal and in vitro studies have shown increased intratumor and intracellular levels of the drug, resulting in enhanced cytotoxicity, even in multidrug-resistant cell lines, while normal tissue toxicity, including cardiotoxicity, may be reduced. L-DNR has been tested as a single agent or in combination with arabinosyl cytosine in the treatment of patients with acute myeloid leukemia (AML) in relapse or in patients with newly diagnosed AML or with disease failing initial remission-induction therapy. The results have indicated that L-DNR can be used at high doses, up to 150 mg/m(2) for 3 days, safely with acceptable toxicity. The anti-leukemia activity has been reported to be at least equal or superior to that of free daunorubicin. Mucositis appeared more frequently than cardiotoxicity and high complete remission rates have been reported in patients with AML in first relapse. However, the superiority of L-DNR with regard to efficacy and toxicity will only be shown by prospective clinical studies comparing?L-DNR with free daunorubicin or other regimens. Two comparative trials are currently active in AML patients, one in children and another in the elderly, run by the international BFM and GIMEMA groups, respectively.