Skin wrinkling and xerosis associated with aging result from decreases of dermal collagen and stratum corneum ceramide content. This study demonstrates that ursolic acid incorporated into liposomes (Merotaine<sup>TM</sup>) increases both the ceramide content of cultured normal human epidermal keratinocytes and the collagen content of cultured normal human dermal fibroblasts. In clinical tests, Merotaine increased the ceramide content in human skin over an 11-day period. Merotaine has effects on keratinocyte differentiation and dermal fibroblast collagen synthesis similar to retinoids. However, unlike retinoids, Merotaine increases ceramide content of human keratinocytes. Ursolic acid may bind to members of the glucocorticoid receptor family to initiate changes in keratinocyte gene transcription.