The effects of liposome formulation on interleukin-7 (IL-7)-dependent lymphopoietic activity was investigated based on the pharmacokinetics and tissue distribution profile of soluble and liposome-formulated recombinant human IL-7. Using I-125-IL-7, we determined the role of liposome formulation on in vivo IL-7 disposition by analyzing injection site, blood, tissue, and urinary kinetics. Following a 30- to 40-mu g subcutaneous dose of soluble IL-7, most of the IL-7 was eliminated through urinary excretion within 24 hr. An equivalent subcutaneous dose of liposome-encapsulated IL-7 resulted in a peak level less than one-tenth that seen with soluble drug but produced sustained blood and urinary levels for 5 days. The bioavailability of liposome-encapsulated IL-7 was comparable to that of soluble IL-7, as determined by both blood and urinary data. Kinetic analysis of IL-7 at the subcutaneous injection site indicated that liposome encapsulation significantly reduced the rate of disappearance at the injection site. Studies with a mixture of 40% liposome-encapsulated and 60% soluble IL-7 gave an intermediate response between that of soluble IL-7 and that of liposome-encapsulated IL-7. Characterization of blood cells from IL-7-treated animals indicated that treatment with two weekly doses of mixed IL-7 liposomes (40% liposome encapsulated IL-7) significantly increased the total numbers of lymphocytes by day 14. In contrast, animals treated with soluble IL-7 on an identical dose and schedule did not produce any effect on blood lymphocytes. Collectively, liposome formulation provided a lower, but significantly sustained blood IL-7 level that enhanced IL-7 effects on blood lymphocyte numbers.