Abstract. Delivery of diphencyprone (DPCP) and minoxidil to hair follicles and related cells is important in the treatment of alopecia. Here we report the development of "squarticles," nanoparticles formed from sebum-derived lipids such as squalene and fatty esters, for use in achieving targeted drug delivery to the follicles. Two different nanosystems, nanostructured lipid carriers (NLC) and nanoemulsions (NE), were prepared. The physicochemical properties of squarticles, including size, zeta potential, drug encapsulation efficiency, and drug release, were examined. Squarticles were compared to a free control solution with respect to skin absorption, follicular accumulation, and dermal papilla cell targeting. The particle size of the NLC type was 177 nm; that of the NE type was 194 nm. Approximately 80% of DPCP and 60% of minoxidil were entrapped into squarticles. An improved drug deposition in the skin was observed in the in vitro absorption test. Compared to the free control, the squarticles reduced minoxidil penetration through the skin. This may indicate a minimized absorption into systemic circulation. Follicular uptake by squarticles was 2-and 7-fold higher for DPCP and minoxidil respectively compared to the free control. Fluorescence and confocal images of the skin confirmed a great accumulation of squarticles in the follicles and the deeper skin strata. Vascular endothelial growth factor expression in dermal papilla cells was significantly upregulated after the loading of minoxidil into the squarticles. In vitro papilla cell viability and in vivo skin irritancy tests in nude mice suggested a good tolerability of squarticles to skin. Squarticles provide a promising nanocarrier for topical delivery of DPCP and minoxidil.