Due to great efforts in past 45 years, several liposomal products including two liposomal vaccine products have been commercialized and many more potential products are now under clinical trial stage. Although liposome has significantly reduced the toxicity of the drugs with improved or maintained the efficacy, its further development has been limited by its instabilities during preparation and storage, incompatibility with certain drugs, relative high cost of production and quality control as well as unspecified drug release time and sites in vivo. In vivo behaviors of liposomal drugs highly depend on their physiochemical properties including lipid composition, particle size, surface charge, surface modifications and the administrated dose as well as the route of administration. Based on the literature reports from the past two decades, the current review provided an updated summary of the key factors in liposomal preparations for clinical usage and its impact on the alternation of pharmacokinetic and disposition behaviors of drugs encapsulated in the liposome formulations. Clinical applications of liposomal preparation in anti-tumor agents, anti-infective agents as well as the macromolecules have been highlighted.