Tenoxicam is one of the potent non-steroidal anti-inflammatory drugs (NSAIDs), which is used clinically in the treatment of rheumatoid arthritis. Like other NSAIDs, Tenoxicam also suffers from the drawback of being associated with gastrointestinal side effects. Further, transdermal penetration of this drug is very poor, which circumvents the use of transdermal route. The main objective of this study is to exploit the concept of ultradeformable vesicles to increase the transport of Tenoxicam through transdermal route, and also to present it as a possible replacement for the oral NSAID therapy for rheumatoid arthritis. Three concentrations (5%, 15% and 25%) of three different surfactants (Tween-80, Span-80 and sodium desoxycholate) were used along with soya lecithin to prepare the ultradeformable vesicles. Among nine different types of vesicles, T3 vesicles (with 25% Tween-80) were found to have shown the smallest size (82.80 AE 0.74 nm), highest release in 24 h (98.01 AE 0.33%) and highest deformability (31.27 AE 0.28) and hence chosen for formulating into the gel. Among three different Carbopol Õ 934 concentrations (1%, 1.5% and 2%), G-2 with 1.5% carbopol was chosen as the final formulation. The formulation has shown almost twice the transdermal flux as compared to the gel with free Tenoxicam. The in vivo performance was also found to be significantly better than the oral Tenoxicam and marketed aceclofenac gel (Hifenac Õ ). This study concluded that the gel containing Tenoxicam encapsulated in ultradeformable vesicles has a better prospective for the transdermal use to treat rheumatoid arthritis.