Improved efficacy in treatment of gastric disorders with botulinum toxin is obtained using liposomal encapsulated botulinum formulations for topical administration of the botulinum toxin. The liposomes are typically administered in a physiologically acceptable carrier such as saline or phosphate buffered saline by application onto the surface of the tissue within into the gastrointestinal (GI) tract in need of treatment. Preferably, the formulation is applied via a roller, sponge or nozzle that is attached to an endoscope.