Abstract: Liposomes are being a potential carrier for advanced drug delivery. These are usually spherical lipid bilayers ranging from 50 to 1000 nm in diameter and serve as a convenient delivery vehicle for therapeutically active drug (small molecule, macromolecules like protein/peptide/Gene). Phospholipid aggregates are easy to form and vulnerable to structural manipulations, allowing for the adjustment of their properties for particular purposes. In selected cases, the application of liposomes in pharmacological therapy improves drug pharmacokinetics compared to its free form. The major advantages of the liposome application are the protection of active compounds from degradation; the increase in circulation time and the possibility to achieve partial or total selectivity. Selectivity alone improves drug potency, eliminates side effects and allows for dosage reduction. In this project the liposomes were reviewed for its nature, type, composition, preparation, mechanism of drug-transport, strategy of targeting and potential applications in respect with the advanced drug delivery system.