Abstract: An improved method is provided for chemotherapy of malignant tumors by injection of antitumor drugs. The antitumor drug is encapsulated within liposomes and the liposomes containing the encapsulated drug are injected into the body. The encapsulated drug penetrates into the tumor cells where the drug is slowly released and induces degeneration and death of the tumor cells, while any toxicity to the host body is reduced. Liposome encapsulation of actinomycin D has been found to be particularly effective in treating cancerous abdominal tumors, while drastically reducing the toxicity of actinomycin D to the host.