The aim of this study is to formulate and compare the physicochemical properties of negatively charged liposomes and poly(lactide-co-glycolide) (PLGA) nanoparticles loaded with gemcitabine hydrochloride. The influence of the formulation variables on the liposome and nanoparticle properties on particle size, zeta potential, encapsulation efficiency, and drug release was evaluated. Although the PEGylated nanoparticles and PEGylated liposomes were of the same size (approximate to 200nm), the encapsulation efficiency was 1.4 times higher for PEGylated liposomes than for PEGylated nanoparticles. The optimized formulation of PEGylated liposomes and PEGylated nanoparticles had 26.1 +/- 0.18 and 18.8 +/- 1.52% encapsulation efficiency, respectively. The release of drug from the PEGylated liposomes and PEGylated nanoparticles exhibited a biphasic pattern that was characterized by a fast initial release during the first 2h followed by a slower continuous release. Transmission electron microscopy (TEM) images identified separate circular structures of the liposomes and nanoparticles. The in vitro cytotoxicity of the optimized formulations was assessed in MCF-7 and MDA-MB-231 cells, and the results showed that the cytotoxicity effect of the gemcitabine hydrochloride-loaded liposomes and nanoparticles was more than commercial product Gemko((R)) and gemcitabine hydrochloride solution.