A test device and method for detecting or quantifying an analyte in a test sample employs an interdigitated electrode array and electroactive marker-encapsulating liposomes for signal generation and detection. The test device includes a contact portion on a first absorbent material, a capture portion either on the first absorbent material, or on a second absorbent material in fluid flow contact with the first absorbent material. The capture portion has a binding material specific for a portion of the analyte bound thereto. The device further includes an electrode array including first and second conductors each having a plurality of fingers, wherein the fingers of the conductors are interdigitated. The electrode array is positioned to induce redox cycling of an electroactive marker released either in or beyond the capture portion, depending upon whether direct (proportional) or indirect (inversely proportional) detection or measurement is desired. In the method of the invention, the test sample is applied to the contact portion, and allowed to migrate along the absorbent material(s) into the capture portion. Either before or after the migration, the test sample is contacted with a conjugate of liposomes and a second binding material for the analyte. To the extent that analyte is present in the sample, the conjugate is bound in the capture portion. By applying a voltage across the conductors, redox cycling of the marker is induced and a current is generated.