The present study has evaluated the potential of alginate-loaded liposomes as a vehicle for the oral delivery of bioactive proteins. The vesicles were prepared from the phospholipid dipalmatoyl phosphatidylcholine using a simple dry film hydration technique. Alkaline phosphatase (ALP) was used as a model bioactive protein, which was encapsulated in alginate-loaded liposomes and conventional liposomes. These vesicles were subject to physical characterization and stability analysis at varying pH values. The enzymatic activity of the ALP was evaluated following exposure to simulated gastric pH. The alginate-loaded liposomes were typically of the order of 10 microm; however, there was evidence of vesicle aggregation thought to be due to alginate present on the surface of the vesicles. The typical size of the aggregated vesicles was approximately 30 microm. The enzyme activity of APL following 2 h of exposure to simulated gastric pH was maintained at a significantly higher level when encapsulated in the alginate-loaded liposomes as compared to ALP loaded in conventional liposomes [80% as compared to 55% (p < 0.05), respectively].