A microemulsion system of docetaxel was prepared and evaluated for its solubilization capacity and oral bioavailability improvement. Based on a solubility study and pseudo ternary phase diagrams, microemulsions of about 30 nm in mean diameter were formulated with improved solubilization capacity towards the hydrophobic drug, docetaxel. The o/w microemulsion formulation (M-3) composed of Capryol 90 (oil), Cremophor EL (surfactant) and Transcutol (co-surfactant) enhanced the solubility of docetaxel up to 30 mg/mL, which maintained solubilization capacity for 24 h even after it was diluted 20 times with normal saline. The three formulations did not show significant difference in the in vitro lipid digestion study. Both the ultrafiltration and dialysis studies revealed that the release of 80% of docetaxel was released from the microemulsions within 12 h in vitro. Compared to the commercial product Taxotere (0.025 microg/cm(2)), the apical to basolateral transport of docetaxel across the Caco-2 cell monolayer from the M-3 formulation (Capryol 90/Cremophor EL/Transcutol=29.4:24.9:12.4, w/w) was significantly improved (0.624 microg/cm(2), p < 0.01). Moreover, the oral bioavailability of the M-3 formulation in rats (34.42%) rose dramatically compared to that of the orally administered Taxotere (6.63%). This increase in bioavailability was probably due to the combined effect of the enhancement in solubility, the inhibition of P-gp efflux system and the increase in permeability. These results encourage further development of docetaxel microemulsions as an oral drug delivery system.