Flow analysis at microvascular bifurcation after partial replacement of red blood cell (RBC) with liposome-encapsulated hemoglobin (LEH) was performed using the lattice Boltzmann method. A two-dimensional symmetric Y bifurcation model with a parent vessel diameter of and daughter branch diameters of was considered, and the distributions of the RBC, LEH, and oxygen fluxes were calculated. When only RBCs flow into the daughter branches with unevenly distributed flows, plasma separation occurred and the RBC flow to the lower-flow branch was disproportionately decreased. On the other hand, when half of RBC are replaced by LEH, the biasing of RBC flow was enhanced whereas LEH flowed favorably into the lower-flow branch, because many LEH within the parent vessel are suspended in the plasma layer, where no RBCs exist. Consequently, the branched oxygen fluxes became nearly proportional to flows. These results indicate that LEH facilitates oxygen supply to branches that are inaccessible to RBCs.