Up-regulation of folate receptor (FR) type-beta in acute myelogenous leukemia (AML) by all-trans retinoic acid (ATRA) and its restricted normal tissue distribution makes it a potential target for therapeutic intervention. The FR-beta in peripheral blood granulocytes was unable to bind folate and appeared to have a variant GPI membrane anchor, evident from its insensitivity to phosphatidylinositol-specific phospholipase C but not nitrous acid. Granulocyte FR-beta lacked mutations, and neither deglycosylation nor detergent solubilization restored folate binding. The posttranslational modification causing its nonfunctionality was evidently absent in FR-beta from AML cells from patient marrow, which bound folate. From flow cytometric analysis of 78 AML bone marrow specimens of different subtypes, 68% expressed FR-beta, most of which were also CD34+. In model cell lines that are FR - (KG-1a, L1210, and Chinese hamster ovary [CHO]) or FR + (KG-1, L1210 JF, and recombinant CHO-FR-beta), selective FR-mediated binding and cytotoxicity was obtained using folate-coated liposomes encapsulating fluorescent calcein (f-L-calcein) and doxorubicin (f-L-DOX), respectively, which could be blocked by 1 mM free folic acid. In the FR-beta-expressing KG-1 human AML cells, treatment with ATRA further increased this specificity. In mouse ascites leukemia models generated using L1210JF or KG-1 cells, increased median survival times were obtained with f-L-DOX treatment compared to nontargeted L-DOX. In the KG-1 model, ATRA treatment increased the cure rate with f-L-DOX from 10% to 60%. The above combined data from our 2 laboratories further support the feasibility and potential usefulness of selective ATRA-facilitated liposomal drug delivery in FR-beta + AMLs.