A single centre phase II study was conducted to determine the toxicity and activity of Caelyx in hormone refractory metastatic prostate cancer. Doxorubicin is known to be active in this setting and liposomal encapsulation may enhance its therapeutic efficacy and also reduce toxicity. Fourteen patients with hormone refractory metastatic prostate cancer were treated with CaelyxTM 50 mg/m2 once every four weeks. All patients had radiologically proven bone metastases and three also had soft tissue metastatic disease. All patients were evaluable for toxicity and response was assessable in thirteen cases. Three PSA responses were documented in patients with non-measurable disease. No patient had an objective response in measurable disease. The commonest toxicity was cutaneous and this was dose limiting in two patients. Gastrointestinal upset was frequent but generally mild. One patient died shortly after an episode of neutropaenic sepsis with associated grade 3 mucositis following his third cycle of chemotherapy. We confirmed the toxicity profile of Caelyx but its modest antitumour efficacy in this group of patients suggests little promise for future study in metastatic prostate cancer.