A method for determining the rate of hydrophilic and hydrophobic drugs release from different types of liposomal dispersions and gels using a dialysis method is described. Dibucaine base and 5-fluorouracil were used as model drugs for a hydrophobic and a hydrophilic drug, respectively. A dialysis technique was employed. Release rates were affected by the rate of rotation of the paddles of the tablet dissolution tester, temperature, and the volume of release medium. The method was used to evaluate the in vitro drug release from hydrophilic and hydrophobic drugs from liposomal dispersions and gels. The in vitro release study of dibucaine base showed no burst effect, while the in vitro release study of 5-fluorouracil showed a clear burst effect with an initial fast release phase followed by a sustained release phase.