Bupivacaine lipospheres were prepared as a parenteral sustained-release system for post-operative pain management. Bupivacaine free base was incorporated into micron-sized triglyceride solid particles coated with phospholipids, which were formed via a hot emulsification and cold resolidification process. The bupivacaine liposphere dispersions were characterized with respect to drug loading, particle-size distribution, and morphology. Gelation of the fluid liposphere dispersions was observed at different time intervals upon storage. The type of phospholipids used in the formulation was found to have a major impact on the gelation of the dispersion. The use of synthetic phospholipids instead of the natural phospholipids in the formulation yielded bupivacaine liposphere dispersions exhibiting prolonged gelation time. The addition of a hydrophilic cellulosic polymer can further improve the physical stability of the dispersion.