There has been keen interest in the development of a novel drug delivery system. Novel drug delivery system aims to deliver the drug at a rate directed by the needs of the body during the period of treatment, and channel the active entity to the site of action. At present, no available drug delivery system behaves ideally achieving all the lofty goals, but sincere attempts have been made to achieve them through novel approaches in drug delivery. A number of novel drug delivery systems have emerged encompassing various routes of administration, to achieve controlled and targeted drug delivery. Encapsulation of the drug in vesicular structures is one such system, which can be predicted to prolong the existence of the drug in systemic circulation, and reduce the toxicity, if selective uptake can be achieved. Consequently a number of vesicular drug delivery systems such as liposomes, niosomes, transfersomes, and pharmacosomes were developed. Advances have since been made in the area of vesicular drug delivery, leading to the development of systems that allow drug targeting, and the sustained or controlled release of conventional medicines. The focus of this review is to bring out the application, advantages, and drawbacks of vesicular systems.