A study of the plasma pharmacokinetics, tumor localization, and safety of a single dose of doxorubicin encapsulated in liposomes containing surface-bound polyethylene glycol (PEG-liposomal doxorubicin) was conducted in patients with Kaposi's sarcoma (KS) as a manifestation of acquired immune deficiency syndrome (AIDS). Eighteen patients with AIDS-KS diagnosed by examination of biopsy specimens were randomly assigned to receive either standard doxorubicin or PEG-liposomal doxorubicin. Consecutive participants were entered at three dose levels (10, 20, and 40 mg/m2) in ascending fashion. Clearance of PEG-liposomal doxorubicin was 0.034 L/h/m2 to 0.108 L/h/m2, volume of distribution (Vd) was 2.2 L/m2 to 4.4 L/m2, and half-lives (t1/2) of the initial decline in the plasma concentration-time curve and of the terminal decline were 3.77 hours and 41.3 hours, respectively. Seventy-two hours after administration, doxorubicin levels observed in lesions of patients receiving PEG-liposomal doxorubicin were 5.2 to 11.4 times greater than those found in patients given comparable doses of standard doxorubicin. PEG-liposomal doxorubicin and standard doxorubicin were roughly equipotent in producing toxicity. Encapsulation in liposomes containing surface-bound PEG significantly limits the distribution and elimination of doxorubicin, results in greater accumulation of the drug in KS lesions 72 hours after dosing than does standard doxorubicin, and may improve drug efficacy and therapeutic index in the treatment of AIDS-KS.