The invention provides for the first time an oral liquid composition of duloxetine or its pharmaceutically equivalent derivatives like salts, isomers, complexes, polymorphs, hydrates or esters thereof. The duloxetine or its pharmaceutically equivalent derivative is present from about 2 mg to approximately 200 mg; and a buffering agent was used to stabilize the acid sensitive duloxetine. The composition has duloxetine from about 0.1 meq to about 2.5 mEq per mg of duloxetine. The invention further discloses an oral liquid composition of duloxetine or its pharmaceutically equivalent derivative wherein the degradation product 1-Naphthol is less than 0.01%. Also provided is a method for treating of major depressive disorder and or diabetic peripheral neuropathic pain comprising administering to a mammal in need of such treatment a therapeutically effective amount of a composition.