Canine osteosarcoma is a spontaneous malignancy in dogs, characterized by micrometastasis to pulmonary and extrapulmonary tissues at the time of diagnosis. Standard treatment involves amputation of the affected leg, but median survival time is 3-4 months with death due to metastasis. A randomized double-blind trial was conducted to evaluate liposome-encapsulated muramyl tripeptide-phosphatidylethanolamine (liposome/MTP-PE) as a treatment for metastasis in dogs undergoing amputation for osteosarcoma. Fourteen dogs were treated with liposome/MTP-PE, and 13 were treated with empty liposomes. Median survival time was 222 days for dogs treated with liposome/MTP-PE, compared to 77 days for dogs treated with empty liposomes (P less than .002). In the liposome/MTP-PE-treated group there were still four dogs alive and free of metastasis at greater than 1 year post surgery. Treatment was well tolerated; no significant toxic effects were noted except for mild elevations in body temperature (1-2 degrees C) for 2-6 hours post injection.