Long circulating non-pegylated liposomes are formed by hydrating lipids formed from a lipid solution comprising a phospholipid, sterol and a solvent with 10 to 35 ml aqueous hydration medium per mmole of phospholipid. The hydration can be carried out before or after solvent removal. Preferably, the hydration medium comprises ammonium sulphate and sucrose and extraliposomal ammonium sulphate is removed using a sucrose-histidine buffer solution. The liposomes can be loaded with a therapeutic or diagnostic agent, especially doxorubicin hydrochloride.