A phase II trial of pegylated liposomal doxorubicin (Caelyx) as induction chemotherapy was conducted in 20 patients with treatment-naïve squamous cell cancer of the head and neck (SCCHN). 10 patients received two cycles of Caelyx (40 mg/m(2)) every 3 weeks before starting radical radiotherapy (RT). Subsequently, consecutive groups of 3 patients received a third escalating dose of Caelyx (10, 15 and 20 mg/m(2)) 3 days before RT. 9 of 18 (50%, 95% confidence intervals (CI): 26-74%) evaluable patients responded to Caelyx, with 11 responses in 26 (42%, 95% CI: 24-62%) evaluable sites (three complete responses (12%), eight partial responses (31%)). There was no grade 3/4 haematological, mucosal or cardiac toxicity. Nausea and vomiting were minimal. There were no drug-related RT delays. Local RT-induced toxicity was not increased. Caelyx has significant activity against SCCHN and warrants further investigation in this disease. In view of its tumour targeting properties and activity at moderate doses, it may be useful in concomitant chemoradiotherapy strategies for SCCHN.