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In this study, niosomes of polyoxyethylene alkyl ethers (Brij™) were prepared for encapsulation of insulin by film hydration method. Without cholesterol, brij 35 and brij 58 did not form niosomes, apparently because of relatively large polar head groups in comparison with their alkyl chains. The size of vesicles depended on the cholesterol content, charge incorporation or hydrophilicity of surfactants. Entrapment of insulin in bilayer structure of niosomes protected it against proteolytic activity of α-chymotrypsin, trypsin and pepsin in vitro. The maximum protection activity was seen in brij 92/cholesterol (7:3 molar ratios) in which only 26.3 ± 3.98% of entrapped insulin was released during 24 h in simulated intestinal fluid (SIF). The kinetic of drug release for most formulations could be best described by Baker and Lonsdale equation indicating diffusion based delivery mechanism. These results indicate that niosomes could be developed as sustained release oral dosage forms for delivery of peptides and proteins such as insulin.