Psoriasis is a lingering inflammatory skin disease that attacks the immune system. The abnormal interactions between T cells, immune cells, and inflammatory cytokines causing the epidermal thickening. International guidelines have recommended topical treatments for mild to moderate psoriasis whilst systemic and phototherapy treatments for moderate to severe psoriasis. However, current therapeutic approaches have a wider extent to treat moderate to severe type of psoriasis especially since the emergence of diverse biologic agents. In the meantime, topical delivery of conventional treatments has prompted many unsatisfactory effects to penetrate through the skin (stratum corneum). By understanding the physiology of stratum corneum barrier functions, scientists have developed different types of lipid-based nanoparticles like solid lipid nanoparticles, nanostructured lipid carriers, nanovesicles, and nanoemulsions. These novel drug delivery systems help the poorly solubilised active pharmaceutical ingredient reaches the targeted site seamlessly because of the bioavailability feature of the nanosized molecules. Lipid-based nanoparticles for psoriasis treatments create a paradigm for topical drug delivery due to their lipids' amphiphilic feature to efficiently encapsulate both lipophilic and hydrophilic drugs. This review highlights different types of lipid-based nanoparticles and their recent works of nano formulated psoriasis treatments. The encapsulation of psoriasis drugs through lipid nanocarriers unfold numerous research opportunities in pharmaceutical applications but also draw challenges for the future development of nano drugs.