The clinical application of gene silencing mediated by small interfering RNA (siRNA) has been limited by the lack of efficient and safe carriers. Phospholipid modification of low molecular weight polyethylenimine (PEI 1.8 kDa) dramatically increased its gene down-regulation capacity while keeping cytotoxicity levels low. The silencing efficacy was highly dependent on the nature of the lipid grafted to PEI and the polymer/siRNA ratio employed. Phosphoethanolamine (DOPE and DPPE) and phosphocholine (PC) conjugation did not change the physicochemical properties and siRNA binding capacity of PEI complexes but had a large impact on their transfection and ability to down-regulate Green Fluorescent Protein (GFP) expression (60%, 30% and 5% decrease of GFP expression respectively). We found that the micelle-forming structure of DOPE and DPPE-PEI dramatically changed PEI's interaction with cell membranes and played a key role in promoting PEI 1.8 kDa transfection, completely ineffective in the absence of the lipid modification.