We studied the interaction of positively and negatively charged unilamellar and multilamellar phospholipid vesicles (liposomes) with rat-liver parenchymal cells in primary monolayer culture. Radioactive liposomal phosphatidylcholine was taken up more rapidly and to a larger extent from unilamellar than from multilamellar vesicles. No significant difference in uptake characteristics was observed between vesicles of different charge. The presence of serum greatly reduced uptake of liposomal phosphatidylcholine of both unilamellar and multilamellar vesicles. This serum effect was independent of surface charge of the vesicles. When cells were allowed to take up radioactive liposomal phospholipid and then incubated further in absence of vesicles, part of the radioactivity associated with the cells was released into the medium, most of it as water soluble degradation products. When cells were preincubated with vesicles containing horseradish peroxidase and then, after removal of the vesicles, further incubated, peroxidase activity could be demonstrated in the culture medium, part of it only after addition of Triton X-100. These observations were taken to indicate that part of the phospholipid taken up the cells represented vesicles binding to the cell surface rather than having been internalized. Vesicle-entrapped [125I]albumin was taken up by the cells and rapidly hydrolyzed as indicated by the appearance of radioactivity soluble in trichloroacetic acid within minutes after starting the incubation. No uptake of free albumin could be demonstrated. The kinetics of albumin uptake and release of trichloroacetic acid-soluble radioactivity from the cells suggest that, initially, liposomes are internalized predominantly by endocytosis, while during prolonged incubation fusion of the liposomal membrane with the plasma membrane gradually contributes more substantially to the overall uptake process. The significance of these findings is emphasized with special reference to the use of liposomes as intravenous carriers of enzymes or drugs.