Various attempts to increase the therapeutic index of the drug while minimizing side effects have been made in drug delivery systems. Among several promising strategies, liposomes represent an advanced technology to target active molecules to the site of action. Rapid clearance of circulating liposomal drugs administered intravenously has been a critical issue because circulation time in the blood affects drug exposure at the target site. The clinical use of liposomal drugs is complicated by large intra- and interindividual variability in their pharmacokinetics (PK) and pharmacodynamics (PD). Thus, it is important to understand the factors affecting the PK/PD of the liposomal formulation of drugs and to elucidate the mechanisms underlying the variability in the PK/PD of liposomal drugs. In this review article, we describe the characteristics of liposome formulations and discuss the effects of various factors, including liposome-associated factors, host-associated factors, and treatment on the PK/PD of liposomal agents.