In the classical “first approximation” theory of thin-shell structures, the constitutive relations for a generic shell element—i.e. the elastic relations between the bending moments and membrane stresses and the corresponding changes in curvature and strain, respectively—are written as if an element of the shell is flat, although in reality it is curved. In this theory it is believed that discrepancies on account of the use of “flat” constitutive relations will be negligible provided the ratio shell-radius∕thickness is of sufficiently large order. In the study of drawing of narrow, cylindrical “tethers” from liposomes it has been known for many years that it is necessary to use instead a constitutive law which explicitly describes a curved element in order to make sense of the mechanics; and indeed such tethers are generally of “thick-walled” proportions. In this paper we show that the proper constitutive relations for a curved element must also be used in the study, by means of shell equations, of the buckling of initially spherical thin-walled giant liposomes under exterior pressure: these involve the inclusion of what we call the “” terms, which are not present in the standard “first-approximation” theory. We obtain analytical expressions for both the bifurcation buckling pressure and the slope of the post-buckling path, in terms of the dimensions and elastic constants of the lipid bi-layer, and also the initial state of bending moment in the vesicle. We explain physically how the initial bending moment can affect the bifurcation pressure, whereas it cannot in “first-approximation” theory. We use these results to map the conditions under which the vesicle buckles into an oblate, as distinct from a prolate (“rugby-ball”) shape. Some of our results were obtained long ago by the use of energy methods; but our aim here has been to identify precisely what is lacking in “first-approximation” theory in relation to liposomes, and so to put the “shell equations” approach onto a firm footing in mechanics.