To reduce the toxicity and enhance the therapeutic efficacy of brucine, a traditional Chinese medicine for relieving arthritic and traumatic pain, in this study, a novel brucine-loaded liposomal hydrogel (BLH) formulation, suitable for topical application, was developed. Spherical liposomes composed of lecithin and cholesterol, with brucine, was prepared by a modified ethanol-dripping method. High percentage (over 80%) of encapsulated brucine in liposomes was obtained. Topical liposomal hydrogel formulations were prepared by further incorporation of the prepared liposomes into structured carbopol 940 hydrogels with the concentration of carbopol 1.0%, the ratio of glycerol to carbopol 8:1 and the brucine content 0.1%. The liposomal hydrogel formulations provided an obvious promotion for skin permeation of bruicne while for the free brucine in hydrogels (BH), there was no detectable drug permeation through the skin. The safety evaluation showed that the prepared BLH were no irritation to both the broken and integrity skin. Pharmacodynamic evaluation revealed that the BLH showed a better therapeutic efficacy than that of the BH. So, it can be concluded that the BLH developed here could represent a safe, effective and promising transdermal formulation for local treatment of analgesic and anti-inflammatory disease.