Liposomal formulations of anticancer agents have been developed to prolong drug circulating lifetime, enhance anti-tumor efficacy by increasing tumor drug deposition, and reduce drug toxicity by avoiding critical normal tissues. Despite the clinical approval of numerous liposome-based chemotherapeutics, challenges remain in the development and clinical deployment of micro- and nano-particulate formulations, as well as combining these novel agents with conventional drugs and standard-of-care therapies. Factors requiring optimization include control of drug biodistribution, release rates of the encapsulated drug, and uptake by target cells. Quantitative mathematical modeling of formulation performance can provide an important tool for understanding drug transport, uptake, and disposition processes, as well as their role in therapeutic outcomes. This review identifies several relevant pharmacokinetic/pharmacodynamic models that incorporate key physical, biochemical, and physiological processes involved in delivery of oncology drugs by liposomal formulations. They capture observed data, lend insight into factors determining overall antitumor response, and in some cases, predict conditions for optimizing chemotherapy combinations that include nanoparticulate drug carriers.