The oral administration of midazolam has often been used for sedation in pediatric patients. However, oral administration of an intravenous formulation of midazolam is difficult for younger pediatric patients because of its bitter taste. Liposomes have been developed as vesicles encapsulating various kinds of drugs to serve as a medical drug-delivery system. Thus, the aim of the present study was to produce pH-sensitive liposomes encapsulating midazolam and to evaluate its pharmacokinetics on rabbits. Liposome-encapsulated midazolam was produced from hydrogenated L-α-phosphatidylcholine, cholesterol, dipalmitoylphosphatidic acid, and midazolam. The capacity of liposomes to encapsulate midazolam (encapsulation efficiency), stability of encapsulation, and release efficiency were evaluated in vitro. Further, the produced liposome-encapsulated midazolam solution was orally administered to rabbits in vivo. As a result, midazolam was encapsulated by liposomes with a high encapsulation efficiency and was stably encapsulated in a physiological medium. Further, the produced liposomes rapidly and effectively released midazolam in an acidic medium in vitro. When the liposome-encapsulated midazolam solution was orally administered to rabbits, the time to achieve the maximum plasma concentration of midazolam after administration was slightly longer, but both the maximum plasma concentration and area under the concentration-time curve were higher than those receiving midazolam solution. In conclusion, we produced pH-sensitive liposome-encapsulated midazolam, which remained stable in a physiological medium and showed efficient release in an acidic environment. The results suggest that it is possible to clinically use liposome-encapsulated midazolam for oral administration as a useful drug-delivery vehicle.