Lipid-peptide interaction has been investigated using cationic amphiphilic alpha-helical peptides and systematically varying their hydrophobic-hydrophilic balance (HHB). The influence of the peptides on neutral and acidic liposomes was examined by 1) Trp fluorescence quenched by brominated phospholipid, 2) membrane-clearing ability, 3) size determination of liposomes by dynamic light scattering, 4) morphological observation by electron microscopy, and 5) ability to form planar lipid bilayers from channels. The peptides examined consist of hydrophobic Leu and hydrophilic Lys residues with ratios 13:5, 11:7, 9:9, 7:11, and 5:13 (abbreviated as Hels 13-5, 11-7, 9-9, 7-11, and 5-13, respectively; Kiyota, T., S. Lee, and G. Sugihara. 1996. Biochemistry. 35:13196-13204). The most hydrophobic peptide (Hel 13-5) induced a twisted ribbon-like fibril structure for egg PC liposomes. In a 3/1 (egg PC/egg PG) lipid mixture, Hel 13-5 addition caused fusion of the liposomes. Hel 13-5 formed ion channels in neutral lipid bilayer (egg PE/egg PC = 7/3) at low peptide concentrations, but not in an acidic bilayer (egg PE/brain PS = 7/3). The peptides with hydrophobicity less than Hel 13-5 (Hels 11-7 and Hel 9-9) were able to partially immerse their hydrophobic part of the amphiphilic helix in lipid bilayers and fragment liposome to small bicelles or micelles, and then the bicelles aggregated to form a larger assembly. Peptides Hel 11-7 and Hel 9-9 each formed strong ion channels. Peptides (Hel 7-11 and Hel 5-13) with a more hydrophilic HHB interacted with an acidic lipid bilayer by charge interaction, in which the former immerses the hydrophobic part in lipid bilayer, and the latter did not immerse, and formed large assemblies by aggregation of original liposomes. The present study clearly showed that hydrophobic-hydrophilic balance of a peptide is a crucial factor in understanding lipid-peptide interactions.