The use of liposomes as a delivery system for hydrophobic and hydrophilic drugs is well recognized. However, they possess several limitations that remained unresolved, including stability problems, low entrapment of the hydrophilic drugs, and the subsequent rapid release. This study introduces a novel approach to incorporate gelatin in the liposomal core to overcome these limitations. A rheological study was conducted to select suitable masses of the gelatin used in the liposomal formulations. Moreover, a full-factorial experimental design was utilized to compare the newly produced gel-core liposomes to the conventional liposomes with respect to the amount of a model hydrophilic molecule loading. An advanced machine learning method, namely, artificial neural networks was utilized to capture the effects of gelatin and cholesterol incorporation in the liposomes on the entrapment efficiency. The results revealed the successful preparation of the novel vesicles and their superiority over the conventional liposomes in drug loading, sustaining the drug release and stability which pose the newly introduced liposomal system as a successful delivery carrier for hydrophilic molecules and drugs. © 2017 Wiley Periodicals, Inc. J Biomed Mater Res Part A: 105A: 3086-3092, 2017.