The most common treatments for rheumatoid arthritis include nonsteroidal anti-inflammatory drugs (NSAIDs), corticosteroids, disease modifying antirheumatic drugs (DMARDs), and some biological agents. However, none of the treatments available is able to achieve the ultimate goal of treatment, that is, drug-free remission. This limitation has shifted the focus of treatment to delivery strategies with an ability to deliver the drugs into the synovial cavity in the proper dosage while mitigating side effects to other tissues. A number of approaches like microemulsions, microspheres, liposomes, microballoons, cocrystals, nanoemulsions, dendrimers, microsponges, and so forth, have been used for intrasynovial delivery of these drugs. Amongst these, liposomes have proven to be very effective for retaining the drug in the synovial cavity by virtue of their size and chemical composition. The fast clearance of intra-synovially administered drugs can be overcome by use of liposomes leading to increased uptake of drugs by the target synovial cells, which in turn reduces the exposure of nontarget sites and eliminates most of the undesirable effects associated with therapy. This review focuses on the use of liposomes in treatment of rheumatoid arthritis and summarizes data relating to the liposome formulations of various drugs. It also discusses emerging trends of this promising technology.