We previously reported that a liposome encapsulating polyethylenimine/oligonucleotides is suitable for in vivo delivery of nucleic acid therapeutics. However, toxicity of polyethylenimine is an obstacle in clinical application. To develop a liposome encapsulating polyplexes applicable to clinical use, we proposed to replace polyethylenimine with chitosan and thus constructed the liposome encapsulating low-molecular weight chitosan (LMWC)/oligonucleotide (ODN) polyplexes [LS(CO)]. ODN was completely complexed to LMWC at pH 5.5 and an N/P ratio 10 with a positive zeta potential of 19.81 ± 1.11. The positively charged polyplexes were encapsulated into anionic liposome by membrane extrusion. Folate-targeted liposome encapsulating LMWC/ODN complex [FLS(CO)] was prepared by adding folate-conjugated phospholipid. The resulting LS(CO) and FLS(CO) were characterized with respect to size distribution, zeta potential, and colloidal stability. The LS(CO) and FLS(CO) were also evaluated for in vitro cellular uptake and cytotoxicity. The LS(CO) and FLS(CO) showed a narrow size distribution with a mean diameter of about 130 nm and neutral zeta potentials and remained stable for 7 days in 0.15-M NaCl at room temperature. FLS(CO) showed higher cellular uptake than LS(CO) in B16F10 murine melanoma cells. Furthermore, LS(CO) showed less toxicity as compared to liposome encapsulating polyethylenimine/oligonucleotides, representing a biocompatible nanocarrier of oligonucleotide therapeutics.