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From what I was told and what the TSA site says it has to be under an amount in a clear container and in a clear bag. Here is the TSA link and info
http://www.tsa.gov/311
Make Your Trip Better Using 3-1-1
3-1-1 for carry-ons = 3.4 ounce (100ml) bottle or less (by volume) ; 1 quart-sized, clear, plastic, zip-top bag; 1 bag per passenger placed in screening bin. One-quart bag per person limits the total liquid volume each traveler can bring. 3.4 ounce (100ml) container size is a security measure.
Consolidate bottles into one bag and X-ray separately to speed screening.
Be prepared. Each time TSA searches a carry-on it slows down the line. Practicing 3-1-1 will ensure a faster and easier checkpoint experience.
3-1-1 is for short trips. If in doubt, put your liquids in checked luggage.
Declare larger liquids. Medications, baby formula and food, and breast milk are allowed in reasonable quantities exceeding three ounces and are not required to be in the zip-top bag. Declare these items for inspection at the checkpoint.