Helichrysum italicum essential oil (H. italicum EO) is recognized for its anti-inflammatory, antimicrobial and wound-healing properties. The main goal of the present work was the development and characterization of a gel formulation comprising H. italicum EO loaded in chitosan nanoparticles (NPs) for dermatological applications. H. italicum EO-loaded chitosan NPs presented hydrodynamic diameter and PdI of about 300 nm and 0.28, respectively, and a surface charge of +19 mV. The H. italicum EO-loaded chitosan NPs were prepared by means of ionic gelation and then incorporated into a thermal water gel formulation. The organoleptic and physicochemical properties of the developed gel were studied. The gel remained stable under accelerated test conditions, maintaining pH, viscosity and organoleptic properties. In addition, the formulation presented pH, viscosity and spreadability properties suitable for topical application. Finally, the performance of the gel in topical application was evaluated on the skin of volunteers using non-invasive methods, particularly, by means of biometric evaluation. These assays showed that the properties of the developed thermal water-based gel formulation with H. italicum EO-loaded chitosan NPs can improve skin hydration and maintain healthy skin conditions, demonstrating its putative role for distinct dermatological applications.