OUTLINE: This is a dose escalation study. Patients receive daunorubicin liposomal IV over a minimum of 2 hours on day 1. Treatment repeats every 3 weeks for a maximum of 8 courses in the absence of disease progression or unacceptable toxicity. Cohorts of 3-6 patients receive escalating doses of daunorubicin liposomal until the maximum tolerated dose (MTD) is determined. The MTD is defined as the dose at which 2 of 6 patients experience dose limiting toxicity. Patients with stable or responding disease are followed at 1 and 3 months, then every 3 months for 1 year.