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Management of transplant patients receiving cyclosporine therapy is complicated by interpatient and intrapatient variability in pharmacokinetic parameters caused by the drug's unpredictable bioavailability. Cyclosporine, a highly lipophilic cyclic polypeptide, has recently been reformulated using a microemulsion delivery system to improve its bioavailability. This new orally administered formulation, Neoral® (cyclosporine capsules and oral solution for microemulsion), has self-emulsifying properties and spontaneously forms a microemulsion (particle size <0.15 μm) in the aqueous fluids of the gastrointestinal tract. Clinical trials in renal transplant recipients, liver transplant recipients with external biliary diversion, and healthy volunteers have demonstrated enhanced bioavailability and greatly improved dose linearity with the cyclosporine microemulsion compared with the original cyclosporine formulation, Sandimmune® (cyclosporine). The rate and extent of absorption were greater with the cyclosporine microemulsion under both fasting and nonfasting conditions, and there was a more consistent relationship between the administered dose and area under the time-concentration curve. Early clinical efficacy trials in renal and liver transplant recipients have shown no difference in the incidence or severity of drug-related adverse events. Studies on the long-term efficacy and safety of the new microemulsion formulation are ongoing.