A solid dispersion containing cyclosporine A (CyA) and polyoxyethylene (40) stearate (PS) was prepared by the solvent-melt method and characterized by powder X-ray diffraction (PXRD), hot-stage microscopy (HSM), scanning electron microscopy (SEM) and dissolution studies. The crystalline peaks of CyA disappeared in the PXRD spectra of solid dispersions but were seen in those of physical mixtures, demonstrating the amorphous state of the drug in solid dispersions. The solubility of CyA in aqueous solutions of PS was increased linearly with increasing amount of PS in water. Dissolution of the drug from solid dispersions and physical mixtures was dramatically enhanced compared to the drug powder alone in water at 37 degrees C.