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Lipid nanoparticles of the cancer drug Chlorambucil (CLB) were prepared by ultrasonication, using stearic acid as the core lipid. Four types of lipid nanoparticle formulations were studied: (i) stearic acid solid lipid nanoparticles (SLN); (ii) sterically stabilized SLN with pegylated phospholipids as stabilizer; (iii) nanostructured lipid complexes with oleic acid as adjunct lipid; (iv) lipid nanocomplexes with dimethyl dioctadecyl ammonium bromide (DDAB) as surface modifier (LN). Lipid nanoparticles were characterized for particle size, assay and encapsulation efficiency, particle morphology and physico-chemical stability over 90 days. All of the formulations were physically stable, with an average particle size of 147 (±10) nm. The drug encapsulation efficiency (DEE) of all the formulations except LN decreased significantly over time (p < 0.05), probably due to the expulsion of CLB upon crystallization. This indicated that the presence of DDAB in stearic acid nanoparticles increases DEE, preventing CLB degradation in the aqueous disperse phase. Pharmacokinetic studies of the intravenous LN formulation revealed plasma clearance kinetics were comparable to that of CLB solution (p > 0.01), indicating electrostatic charge mediated clearance, as reported earlier. In tissue and tumor distribution studies, lower AUC values of CLB were observed for LN compared to CLB solution in liver, kidneys, heart and lungs. However, higher AUC values of LN formulation as compared to CLB solution (p < 0.01) in tumors suggested that the presence of DDAB on the lipid nanoparticles resulted in greater accumulation of the drug in tumors.