In the first part, medical applications of liposomes loaded with small molecular weight drugs is discussed and the use of sterically stabilized liposomes containing doxorubicin in cancer therapy is presented. A brief theoretical description of the origin of liposome stabilization by the surface-attached polymer is also included. The second part deals with gene delivery by the use of cationic lipids, the structure of the DNA-lipid complexes and structure-transfection activity relationships. Structurally the complexes contain ordered domains in which parallel helices of two-dimensionally ordered DNA are adsorbed onto lipid bilayers. The periodicity between stacked lipid bilayers with sandwiched DNA is 6.5 nm, while the interhelical separation of 3.6 nm within the DNA layer was observed by X-ray scattering as well as electron and atomic force microscopy. Typically cationic lipids are formulated with neutral lipid and cholesterol was shown to be the most effective for transfection in vivo, which was correlated to the formation of small and dense DNA-lipid complexes. Following structure-activity studies, a model of gene transfection is proposed.