In recent years, there has been considerable effort in designing improved delivery systems by including site-directed surface ligands to further enhance their selective targeting. The goal of this study is to engineer alpha(5)beta(1)-targeted stealth liposomes (nanoparticles covered with poly(ethylene glycol) (PEG)) that will bind to alpha(5)beta(1)-expressing LNCaP human prostate cancer cells and efficiently release the encapsulated load intracellularly. For this purpose, liposomes (with and without PEG2000) were functionalized with a fibronectin-mimetic peptide (PR_b) and delivered to LNCaPs. The amount of PEG2000 and other liposomal components were characterized by H-1 NMR, and the amount of peptide by the bicinchoninic acid protein assay. Fibronectin is the natural ligand for alpha(5)beta(1), and a promising design for a fibronectin-mimetic peptide includes both the primary binding site (RGD) and the synergy site (PHSRN) connected by a linker and extended off a surface by a spacer. We have previously designed a peptide-amphiphile, PR_b, that employed a hydrophobic tail, connected to the N-terminus of a peptide headgroup composed of a spacer, the synergy site sequence, a linker mimicking both the distance and hydrophobicity/hydrophilicity present in the native protein fibronectin (thus presenting an overall "neutral" linker), and finally the primary binding sequence. We have examined different liposomal formulations, functionalized only with PR_b or with PR_b and PEG2000. For PR_b-targeted PEGylated liposomes, efficient cell binding was observed for peptide concentrations of 2 mol % and higher. When compared to GRGDSP-targeted stealth liposomes, PR_b functionalization was superior to that of GRGDSP as shown by increased LNCaP binding, internalization efficiency, as well as cytotoxicity after incubation of LNCaPs with tumor necrosis factor-alpha (TNF alpha)-encapsulated liposomes. More importantly, PR_b is alpha(5)beta(1)-specific, whereas many integrins bind to small RGD peptides. Thus, the proposed PR_b-targeted delivery system has the potential to deliver a therapeutic payload to prostate cancer cells in an efficient and specific manner.