Today, nanotechnology is a commonly used buzz world in numerous fields of science and everyday life, and fairly recently in drug delivery. During the last few decades liposomes have attracted great interest and investigated as ideal models for biological membranes as well as efficient carriers for drugs, diagnostics, vaccines, nutrients and other bioactive agents. Liposome has been under investigation for many years and number of drugs and genes investigated for controlled release with liposomal formulation is very extensive. Liposome has been investigated for use in cancer treatment, have been shown to reduce the side effects and have been researched for the delivery of protein and neuclic acids. Like all other colloidal system, liposomes suffer from various short comings including interaction with lipoproteins, having high critical micelle concentration that limits stability and limit availability of inexpensive pharmaceutical grade lipids. This review will provide an overview of lipid based vesicle system followed by some of more interesting opportunities and application of it.