Vesicular phospholipid gels (VPG), i.e. highly concentrated liposomal dispersions, are suitable for entrapping substances such as anticancer drugs with particular high encapsulation efficiencies (EE). We prepared different formulations of VPG with 30% (w/w) lipid containing 5-fluorouracil (5-FU) by high pressure homogenization and analysed their EE and drug release. Using mixtures of hydrogenated soy phosphatidylcholine and cholesterol with molar ratios ranging from 55/45 to 75/25, a decreasing amount of cholesterol correlated with an increasing EE, which is probably due to a reduced amount of smaller vesicles and number of lamellae. Using a 5-FU solution of pH 8.6 for VPG preparation, an EE of approximately 40% was found after redispersion of the gel to a liposomal dispersion and separation of free drug from liposomal drug by size exclusion chromatography. The reduced EE for preparations with lower pH values was attributed to a fast initial drug release due to the increased drug lipophilicity below the pK(a) value of 8. After redispersion of a VPG of pH 8.0, an initially faster release of about a third of the entrapped drug was found during the first 20 min, followed by stable entrapment over many hours. The rapid initial release may be due to the portion of liposomes smaller than 40 nm in diameter, determined by photon correlation spectroscopy. Cryo electron microscopic pictures show a lentil-like shape of these small liposomes. The membrane defects on the edges are probably the reason for the very high initial drug release rate. The half-life time of the release of 5-FU from intact FU-VPG at both pH 7.4 and 8.0 was found to be in the order of 4-5 h and the kinetics are typical for matrix-controlled drug diffusion. The in vitro data of 5-FU loaded VPG suggest their applicability as implants with controlled release properties or, after redispersion, as intravenously injected liposomal formulations.