Liposomal drug delivery appears to improve the antitumor effect and reduce toxicity compared with the free drug. The therapeutic index may be improved further by combining cytotoxic drugs and radiotherapy. Successful therapy requires that the cytotoxic agents reach the tumor cells. Therefore, we studied tumor growth and the microdistribution of liposomal doxorubicin (Caelyx) with and without additional ionizing radiation in human osteosarcoma xenografts in athymic mice. Caelyx was injected i.v. 1 day before single or fractionated radiotherapy. Both chemoirradiation regimens induced significant tumor growth delays and worked synergistically. Confocal laser scanning microscopy showed that intact liposomes were located in close proximity to endothelial cells, and the distribution of released doxorubicin was heterogeneous. Before radiotherapy, hardly any doxorubicin was localized in the central parts of the tumor. Radiotherapy increased the tumor uptake of doxorubicin by a factor of two to four, with drug being redistributed farther from the vessels in the tumor periphery and located around vessels in the central parts of the tumor. Colocalization of doxorubicin and hypoxic cells showed no distribution of drug into hypoxic areas. Dynamic contrast-enhanced magnetic resonance imaging (MRI) 1 day before the injection of Caelyx and 2 days after treatment start showed that the combined treatment reduced the vascular volume and the vascular transfer rate of the MRI tracer. The results show that chemoirradiation with Caelyx induces synergistic treatment effects. Improved intratumoral drug uptake and distribution are responsible to some extent for the enhanced antitumor effect.