The toxicity and therapeutic efficacy of free adriamycin (AM) and AM entrapped in standardized liposomes (AM-MLV) were evaluated in normal mice and in mice bearing M 5076 murine tumor, which metastasizes to the liver after i.v. and s.c. transplants of tumor cell suspensions. Acute and chronic toxicity to AM could be reduced by drug encapsulation in liposomes. The data indicated that at approximately equitoxic doses of free AM (10 mg/kg) and AM-MLV (greater than 20 mg/kg), the increase in survival times of mice transplanted i.v. with tumor cells were 25% and 100%, respectively. Furthermore, only in the AM-MLV-treated mice were long-term survivors observed. In contrast AM-MLV were equally effective as free AM in mice transplanted s.c. with tumor cell suspensions. AM-MLV, however, were more effective than free AM against liver metastases in mice bearing s.c. tumor, indicating differential antitumor activities against the same tumor type growing at different locations in the same animals.