Design of a liposome delivery system for vaginal administration of acyclovir, able to provide sustained release and improved bioavailability of the encapsulated drug for the local treatment of genital herpes was investigated. Acyclovir was encapsulated in liposomes prepared by the polyol dilution method, whereby various phospholipid compositions were used: egg phosphatidylcholin (PC)/egg phosphatidylglycerol (PG) 9:1, egg phosphatidylcholine (PC) and egg phosphatidycholine (PC)/stearylamine (SA) 9:3. All liposome preparations were characterized and compared for particle size, polydispersity, encapsulation efficiency and tested for in vitro stability in different media chosen to simulate human vaginal conditions: buffer, pH 4.5 (corresponding to normal human vaginal pH), vaginal fluid simulant (medium developed so as to mimic the fluid produced in the vagina) with or without mucin. To be closer to in vivo application of liposomes and to achieve further improvement of their stability, liposomes were incorporated in a vehicle suitable for vaginal self-administration. Bioadhesive hydrogel made from Carbopol 974P NF resin with adequate pH value and desirable viscosity was chosen as a vehicle for liposomes containing acyclovir. In vitro release studies of liposomes incorporated in the hydrogel proved their applicability as a novel vaginal delivery system with localized and sustained release of encapsulated acyclovir. Even after 24 h of incubation in vaginal fluid simulant more than 35% of the originally encapsulated drug was retained in the hydrogel.