Bilosomes are bile salts-containing vesicles that have recently draw the attention as a novel nanocarrier for drugs. Compared to traditional nanocarriers, bilosomes have the advantage of being able to withstand disruption caused by physiological bile salts normally secreted in the gastrointestinal tract. In addition to nonionic surfactant and bile salts, cholesterol is one important ingredient in bilosomes composition. This work investigated the effect of cholesterol concentration on the release rate of the entrapped drug. Tamoxifen was used as a model drug that suffers from poor oral bioavailability due to poor solubility and extensive pre-systemic degradation. Bilosomes composed of Span 60, cholesterol and bile salts were prepared. Cholesterol was used at two different concentrations of 0.4% and 0.8% w/v producing formulations BiL1 and BiL2, respectively. The entrapment efficiency and in vitro drug release were evaluated, using Franz diffusion cells. Increasing cholesterol concentration reduced drug released. The release efficiency values after 24 hours of release study were 9.7 and 6.8% for BiL1 and BiL2, respectively. This indicates that increasing cholesterol concentration increased the rigidity of bilosomal membrane and enhanced drug encapsulation. Reduced release would indicate that the vesicles retain the encapsulated drug which is advantageous taken into consideration the lymphatic absorption of the vesicles.