The development of peptide-based vaccines that elicit antibody (Ab) and cellular immune responses has been hampered by the lack of highly immunogenic formulations. In this study, we compared the induction of Ab and cytotoxic T-lymphocyte (CTL) responses to a peptide derived from the V3 loop of HIV-1 gp120 (P18 and its cysteine-glycine derivative (CG-P18)) when incorporated into liposomes with lipid A (LA) or mixed with aluminum hydroxide. P18-specific CTL were only observed with liposomes with LA. P18-specific Ab responses were found with liposomes containing CG-P18 but not P18. Increased surface expression of the former, resulted in enhancement of the Ab response without loss of CTL induction. Thus, the manner in which a peptide is localized can influence the outcome of the response induced by highly immunogenic liposome formulations.