We propose a mechanism for oligonucleotide (ODN) release from cationic lipid complexes in cells that accounts for various observations on cationic lipid-nucleic acid-cell interactions. Fluorescent confocal microscopy of cells treated with rhodamine-labeled cationic liposome/ fluorescein-labeled ODN (F-ODN) complexes show the F-ODN separates from the lipid after internalization and enters the nucleus leaving the fluorescent lipid in cytoplasmic structures. ODN displacement from the complex was studied by fluorescent resonance energy transfer. Anionic liposome compositions (e.g., phosphatidylserine) that mimic the cytoplasmic facing monolayer of the cell membrane released ODN from the complex at about a 1:1 (-/+) charge ratio. Release was independent of ionic strength and pH. Physical separation of the F-ODN from monovalent and multivalent cationic lipids was confirmed by gel electrophoresis. Fluid but not solid phase anionic liposomes are required, whereas the physical state of the cationic lipids does not effect the release. Water soluble molecules with a high negative linear charge density, dextran sulfate, or heparin also release ODN. However, ATP, spermidine, spermine, tRNA, DNA, polyglutamic acid, polylysine, bovine serum albumin, or histone did not release ODN, even at 100-fold charge excess (-/+). Based upon these results, we propose that the complex, after internalization by endocytosis, induces flip-flop of anionic lipids from the cytoplasmic facing monolayer. Anionic lipids laterally diffuse into the complex and form a charged neutralized ion-pair with the cationic lipids. This leads to displacement of the ODN from the cationic lipid and its release into the cytoplasm.