E. coli is an Enterobacteriaceae that could develop resistance to various antibiotics and become a multi-drug resistant (MDR) bacterium. Options for treating MDR E. coli are limited and the pipeline is somewhat dry when it comes to antibiotics for MDR bacteria, so we aimed to explore more options to help in treating MDR E. coli. The purpose of this study is to examine the synergistic effect of a liposomal formulations of co-encapsulated azithromycin and N-acetylcysteine against E. coli. Liposomal azithromycin (LA) and liposomal azithromycin/N-acetylcysteine (LAN) were compared to free azithromycin. A broth dilution was used to measure the MIC and MBC of both formulations. The biofilm reduction activity, thermal stability measurements, stability studies, and cell toxicity analysis were performed. LA and LAN effectively reduced the MIC of E. coli SA10 strain, to 3 μg/ml and 2.5 μg/ml respectively. LAN at 1 × MIC recorded a 93.22% effectiveness in reducing an E. coli SA10 biofilm. The LA and LAN formulations were also structurally stable to 212 ± 2 °C and 198 ± 3 °C, respectively. In biological conditions, the formulations were largely stable in PBS conditions; however, they illustrated limited stability in sputum and plasma. We conclude that the formulation presented could be a promising therapy for E. coli resistance circumstances, providing the stability conditions have been enhanced.