OBJECTIVE Kaposi's sarcoma (KS) is the most common tumor in patients with AIDS and can be fatal in patients with lung involvement. Systemic chemotherapy is the most effective treatment for pulmonary KS. We thus conducted this study to determine the efficacy of liposomal daunorubicin in the treatment of patients with pulmonary KS. METHODS Patients with biopsy-proven, symptomatic pulmonary KS were accrued. Liposomal daunorubicin was given at a dose of 60 mg/m2 intravenously every 2 weeks. Response was monitored by chest radiographs, pulmonary function tests, arterial blood gases, and grading of pulmonary symptoms. RESULTS Fifty-three male patients were accrued. The median CD4+ lymphocyte count was 13/microL (range, 0 to 200); 70% reported a prior AIDS-defining opportunistic infection. All patients were symptomatic, with cough reported in all patients, shortness of breath in 94%, and hemoptysis in 55%. The mean study entry diffusing capacity of carbon monoxide (DLCO) was 58.5% (percent of predicted). The median dose of liposomal daunorubicin delivered was 360 mg/m2 (range, 60 to 1,380). More than 75% of patients had complete or partial resolution of baseline pulmonary symptoms. Complete or partial improvement in DLCO was observed in 22%; complete or partial resolution of radiographic abnormalities was reported in 32%. The most common treatment-related toxicity was neutropenia, which occurred in 85%. There were no instances of cardiac toxicity observed, even at high cumulative doses. CONCLUSIONS Liposomal daunorubicin at 60 mg/m2 is safe and active in patients with pulmonary KS. Trials combining liposomal daunorubicin with other active agents in KS should be considered.