In this study liposomes were developed and evaluated for timolol maleate (TM) and latanoprost (LP) by lipid film hydration technique for the treatment of glaucoma. A 3 2 factorial design was utilized to study the effect of the molar ratio of 1, 2 -Dipalmitoyl-sn-glycero-3-phosphocholine (DPCC) (X1) and cholesterol (X2) on vesicle size, drug entrapment efficiency and in-vitro release study. Fourier transform infrared spectroscopy (FT-IR) studies were performed to investigate and predict any physiological interactions between components in the formulation. The liposomal vesicles were found to be uniform in size and shape. The drug entrapment efficiency values for the seven batches showed a variation from a minimum of 56.65 ± 1.39 % to maximum of 70.24 ± 1.14 %. This clearly indicates that the drug entrapment value is strongly dependent on the variables selected. The Zeta potential, average particle size and poly dispersibility index was found to be -17.3 mV, 240 nm and 0.114 respectively. Most of the formulations were found to have a linear release and the formulations were found to provide approximately 72 % -55 % of drug release for TM and LP respectively within a period of 6 h. Kinetic study reveals that release mechanism depends on swelling, diffusion and relaxation. Best formulation (F2) was found to be sterile and stable and free from microorganisms and passes the isotonicity test. Reduction in intra ocular pressure (IOP) was greater in liposomes as compared to the marketed product of alone and combination medication. A latanoprost-timolol maleate fixed combination, has the advantage of a more convenient delivery system as well as providing a simple summing effect of the two constituents.