Poly(ethylene glycol)-phosphatidylethanolamine conjugate (PEG-PE) has been used in preparing longcirculating liposomes. As a substitute for PEG-PE which can also be used in the long-circulating liposome formualtions, but can be prepared more readily with a lower cost, PEG-Phe-Chol was synthesized from PEG, phenylalanine, and cholesterol. The addition of the PEG derivative to distearoylphosphatidylcholine (DSPC) led to the formation of mixed micelles as well as liposomes when the derivative content was 10 mol% or greater. On the other hand, the addition of just 5 mol% PEG-Phe-Chol to dioleoylphosphatidylethanolamine (DOPE) generated mixed micelles as well as liposomes, but the formation of mixed micelles was completely inhibited by the addition of cholesterol. The leakage of entrapped calcein out of DOPE/cholesterol (7/3) liposomes containing 5 mol% PEG-Phe-Chol was about 45% during the incubation time for 24 h in 50% rabbit plasma, which was similar to that of the same liposomes containing 5 mol% PEG-dipalmitoylphosphatidylethanolamine (DPPE) under the identical conditions.