Liposomes are microscopic spheres, usually composed of amphiphilic phospholipids. They may be useful without skin penetration if they simply protect or sequester compounds that would otherwise be unstable in the formulation. Liposomes that remain on the skin surface are useful as light-absorbers, agents to deliver color or sunscreens, or as depots for timed-release. Liposomes that penetrate the stratum corneum have the potential to interact with living tissue. Topically applied liposomes can either mix with the stratum corneum lipid matrix or penetrate the stratum corneum by exploiting the lipid-water interface of the intercellular matrix. There are at least four major routes of entry into the skin: pores, hair follicles, columnular spaces and the lipid:water matrix between squames. A major force driving liposome penetration is the water gradient, and flexible liposomes are best able to exploit these delivery opportunities. Some liposomes release their contents extracellularly. Topical application of photosensitizers may be enhanced by encapsulation in liposomes. Higher and longer-lasting drug concentrations may be produced in localized areas of skin, particularly at disease sites where the stratum corneum and the skin barrier function are disrupted. The liposome membrane should be designed to capture lipophilic drugs in the membrane or hydrophilic drugs in the interior. Other types of liposomes can be L iposomes are microscopic vesicles, usually formed from phospholipids. The useful phospholipids are amphipathic, in that they have both lipophilic and hydrophilic moieties. Under the right conditions these molecules will stack on solid supports to form membranes, with the hydrophilic head groups arranged on one side of the array, and the hydrophilic tail groups on the other. In aqueous solution, these arrays spontaneously form bilayers membranes in the shape of a sphere, which are called liposomes (1). Here the hydrophilic head groups point out toward water, and the lipophilic tails point to 203 engineered to be taken up by cells. Once inside cells, the lysosomal sac and clatherin-coated pit are the dead-end destinations for liposomes unless an escape path has been engineered into the liposome. A novel method has been developed to allow delivery into cells of the skin, by escape from the lysosomal sac. These liposomes have been used to topical deliver active DNA repair enzymes from liposomes into epidermal cells and to enhance DNA repair of UV-irradiated skin. From these studies a tremendous amount has been learned about the relationship of DNA damage and skin cancer. Both mutations and immunosuppression appear to be essential to skin cancer and both are induced by DNA damage. DNA damage produces immediate effects by inducing the expression of cytokines, which means that DNA damage can induce signaling in neighboring, undamaged cells. The repair of only a fraction of the DNA damage has a disproportionate effect on the biological responses, clearly demonstrating that not all DNA damage is equivalent. This technolo...