The adjuvant efficacy of cationic liposomes composed of dimethyldioctadecylammonium bromide and trehalose dibehenate (DDA:TDB) is well established. Whilst the mechanism behind its immunostimulatory action is not fully understood, the ability of the formulation to promote a 'depot effect' is a consideration. The depot effect has been suggested to be primarily due to their cationic nature which results in electrostatic adsorption of the antigen and aggregation of the vesicles at the site of injection. The aim of the study was to further test this hypothesis by investigating whether sterically stabilising DDA:TDB with polyethylene glycol (PEG) reduces aggregation, and subsequently influences the formation of a depot at the site of injection. Results reported demonstrate that high (25%) levels of PEG was able to significantly inhibit the formation of a liposome depot and also severely limit the retention of antigen at the site, resulting in a faster drainage of the liposomes from the site of injection. This change in biodistribution profile was reflected in the immunisation response, where lower levels of IgG2b antibody and IFN-γ and higher level of IL-5 cytokine were found. Furthermore entrapping antigen within DDA:TDB liposomes did not improve antigen retention at the injection site compared surface adsorbed antigen.