A simple HPLC method was developed for quantification of SN-38, 7-ethyl-10-hydroxycamptothecin, in a novel liposome-based formulation (LE-SN38). The chromatographic separation was achieved on an Agilent Zorbax SB-C18 (4.6 mm × 250 mm, 5 μm) analytical column using a mobile phase consisting of a mixture of NaH2PO4 (pH 3.1, 25 mM) and acetonitrile (50:50, v/v). SN-38 was detected at UV wavelength of 265 nm and quantitatively determined using an external calibration method. The limit of detection (LOD) and limit of quantitation (LOQ) were found to be 0.05 and 0.25 μg/mL, respectively. The individual spike recovery of SN-38 ranged from 100 to 101%. The percent of relative standard deviation (%R.S.D.) of intra-day and inter-day analyses were less than 1.6%. The method validation results confirmed that the method is specific, linear, accurate, precise, robust and sensitive for its intended use. The current method was successfully applied to the determination of SN-38 content and drug entrapment efficiency in liposome-based formulation, LE-SN38 during early stage formulation development.