The degradation kinetics of taxol in aqueous solutions were investigated at 37°C over a pH range of 1-9. The hydrolysis rates followed pseudo first-order kinetics with respect to residual taxol concentration. The pH-rate profile at 37°C showed that a maximum stability of taxol occurred in the pH 3-5 region. The effect of γ-cyclodextrin (γCD), hydroxypropyl-γ-cyclodextrin (HPγCD) and hydroxypropyl-β-cyclodextrin (HPβCD) on the solubility and stability of taxol was also investigated. Taxol was more stable in cyclodextrin solution than in buffer solution of comparable pH. The solubility of taxol in water increased in the presence of cyclodextrins with HPβCD giving the greatest increase in taxol solubility. Taxol (as received) was anhydrous and on suspension in water, it dissolved to form a supersaturated solution which recrystallized as a hydrate of lower solubility. Taxol formed predominantly second order complexes with the cyclodextrins. Complexes of taxol with HPβCD were more stable than those of HPγCD or γCD. Further increase in the solubility of taxol was observed when ethanol was added as a co-solvent.