The aim of the study is to prepare aqueous dispersions of lipid nanoparticles--flurbiprofen solid lipid nanoparticles (FLUSLN) and flurbiprofen nanostructured lipid carriers (FLUNLC) by hot homogenization followed by sonication technique and then incorporated into the freshly prepared hydrogels for transdermal delivery. They are characterized for particle size, for all the formulations, more than 50% of the particles were below 300 nm after 90 days of storage at RT. DSC analyses were performed to characterize the state of drug and lipid modification. Shape and surface morphology were determined by TEM which revealed fairly spherical shape of the formulations. Further they were evaluated for in vitro drug release characteristics, rheological behaviour, pharmacokinetic and pharmacodynamic studies. The pharmacokinetics of flurbiprofen in rats following application of SLN gel (A1) and NLC gel (B1) for 24 h were evaluated. The Cmax of the B1 formulation was 38.67 +/- 2.77 microg/ml, which was significantly higher than the A1 formulation (Cmax = 21.79 +/- 2.96 microg/ml). The Cmax and AUC of the B1 formulation were 1.8 and 2.5 times higher than the A1 gel formulation respectively. The bioavailability of flurbiprofen with reference to oral administration was found to increase by 4.4 times when gel formulations were applied. Anti-inflammatory effect in the Carrageenan-induced paw edema in rat was significantly higher for B1 and A1 formulation than the orally administered flurbiprofen. Both the SLN and NLC dispersions and gels enriched with SLN and NLC possessed a sustained drug release over period of 24 h but the sustained effect was more pronounced with the SLN and NLC gel.