Liposomes are microscopic vesicles composed of membrane-like lipid bil
ayers surrounding aqueous compartments. This unique feature imparts th
e ability of liposomes to encapsulate both lipophilic and hydrophilic
compounds. Consequently liposomes have been investigated extensively a
s a drug carrier system by various routes of administration. One of th
e more recent applications is the concept of employing liposomes as dr
ug carriers in ophthalmology. Traditional drug therapy in the eye cons
ists of the administration of solutions and suspensions. These dosage
forms are compromised in their effectiveness by several limitations in
cluding rapid nasolacrimal drainage, poor corneal penetration, nonprod
uctive conjunctival losses and unwanted systemic exposure. The need fo
r an ocular drug delivery system which has the convenience of a drop,
but will localize and maintain drug activity at its site of action, is
apparent. Liposomes offer a promising avenue to achieve this goal. Th
e simplicity of preparation and the versatility in physical characteri
stics confer a unique and useful property to liposomes for use as an o
cular drug deliverer. In this review, a historical account of the stud
ies is presented to illustrate the potential of liposomes in ophthalmo
logy. Consideration is given to methods of preparation, advantages of
liposomes as drug carriers as well as some of the general issues surro
unding liposomes as a pharmaceutically acceptable dosage form. Various
routes of administration such as topical instillation, intravitreal,
subconjunctival and systemic injection are also discussed. Significant
progress has been made in these areas and a complete understanding of
the liposome interaction with ocular tissues should enable the design
of liposomal products suitable for ocular drug delivery.