Niosomes embodying ethanol and minimum amount of cholesterol (ethoniosomes) could be promising ocular delivery systems for water soluble and insoluble drugs. This manuscript reports on novel nano-sized elastic niosomes (ethoniosomes) composed of Span 60: cholesterol (7:3 mol/mol) and ethanol, for ocular delivery of prednisolone acetate (Pred A) and prednisolone sodium phosphate (Pred P). These ethoniosomes were prepared with the thin film hydration (TFH) and ethanol injection (EI) methods, characterized for percentage entrapment efficiency (% EE), size, zeta potential, morphology, elasticity, in vitro release and physical stability. Ocular irritation, bioavailability and anti-inflammatory effects were evaluated and compared with the conventional suspension and solution eye drops. The prepared ethoniosomal vesicles (EV) had a Z-average diameter of 267 nm, zeta potential of approximately -40 mV and % change in size after extrusion of 4%. They were physically stable for at least 2 months at 4 °C. The prepared EV showed good ocular tolerability using the modified Draize's test and the estimated relative ocular bioavailability for Pred A EV and Pred P EV was 1.54 and 1.75 times greater than that for the suspension and solution eye drops, respectively. The time required for complete healing from the clove oil-induced severe ocular inflammation was reduced to half with Pred A and Pred P EV. More interestingly, the intraocular pressure (IOP) elevation side effect recorded for Pred A and Pred P EV was significantly less than that for the conventional suspension and solution eye drops.