Most liposomes used as drug delivery systems contain cholesterol as a majot structural component. Cholesterol has profound effects on the chemical, physical and metabolic stability of liposomes and lipsome drug products and must be accurately monitored during formulation and processing development, stability testing and manufacturing. Before analyzing their components, the liposomes must be disintegrated and solubilized by dilution with methanol or 2-propanol. This high-performance liquid chromatographic assay is applicable to the resulting lipid-rich matrices and allows a direct quantitative analysis of cholesterol. Cholesterol separates well from common ingredients of liposome-based drug products and cholesterol oxidation products. Calibration curves are linear over two order of magnitude and the cholesterol detection limit is 1.5 μl/ml. Method precision for an anticancer liposome drug formulation was 0.9% relative standard deviation. The assay is also useful for measuring cholesterol in phospholipid and cholesterol raw materials. © 1990.