The present investigation aimed at developing Doxorubicin (DOX)-loaded liposome-mediated drug delivery system for head and neck cancer. The liposomes were prepared by film hydration technique using egg phosphatidylcholine and cholesterol using Box-Behnken statistical design. The prepared liposomes were evaluated for the percentage encapsulation efficiency, particle size and in vitro release. The average particle size of the DOX-encapsulating liposomes formulated by thin-film hydration technique was between 150.5 nm and 200 nm with an average particle size of 165.80 nm. The PDI (Polydispersity index) was found to be 0.315 which indicated that particles were monodispersed and narrow-dispersed. In vitro drug release of DOX-loaded liposomes and DOX-loaded peptide-conjugated liposomes was performed in phosphate buffered saline (pH 7.4) and both formulations showed sustained release behavior over the period of 40 hours. The optimized liposomal formulation was conjugated to a peptide and subsequently radiolabeled with 186Re-perrhenate solution and BMEDA-glucoheptonate-stannous chloride solution. Comparative cytotoxicity assay of DOX, DOX-liposomes and DOX-liposomes-peptide on SCC9 cells was performed and it was found that liposomal formulation was not cytotoxic. The antitumor efficacy of 186Re-liposomes, unlabelled liposomes, 186Re-perrhenate solution and 186Re-BMEDA solution was determined in SCC cell lines injected into BALB/c-nu/nu athymic nude rats. The efficacy of antitumor activity was found to be in the following order: peptide-conjugated DOX-loaded liposomes>unlabelled liposomes>186Re-perrhenate solution>186Re-BMEDA solution. The present investigation showed that peptide-conjugated DOX-loaded liposomes significantly suppress the tumor growth in the nude rat model. These results suggest the significant potential of liposomes as carriers for clinical applications in head and neck cancer.