Alginate is a natural biopolymer widely studied for pharmaceutical applications due to its biocompatibility, low toxicity, and mild gelation abilities. This review summarizes recent advances in alginate-based encapsulation systems for targeted drug delivery. Alginate formulations like microparticles, nanoparticles, microgels, and composites fabricated by methods including ionic gelation, emulsification, spray drying, and freeze drying enable tailored drug loading, enhanced stability, and sustained release kinetics. Alginate microspheres prepared by spray drying or ionic gelation provide gastric protection and colon-targeted release of orally delivered drugs. Alginate nanoparticles exhibit enhanced cellular uptake and tumor-targeting capabilities through the enhanced permeation and retention effect. Crosslinked alginate microgels allow high drug loading and controlled release profiles. Composite alginate gels with cellulose, chitosan, or inorganic nanomaterials display improved mechanical properties, mucoadhesion, and tunable release kinetics. Alginate-based wound dressings containing antimicrobial nanoparticles promote healing of burns and chronic wounds through sustained topical delivery. Although alginate is well-established as a pharmaceutical excipient, more extensive in vivo testing is needed to assess clinical safety and efficacy of emerging formulations prior to human trials. Future opportunities include engineered systems combining stimuli-responsiveness, active targeting, and diagnostic capabilities. In summary, this review discusses recent advances in alginate encapsulation techniques for oral, transdermal, and intravenous delivery, with an emphasis on approaches enabling targeted and sustained drug release for enhanced therapeutic outcomes.