Objective: The aim of this study was to develop a formulation for lymphatic uptake with enhanced solubility of antifungal drug, terbinafine by use of self-microemulsifying drug delivery system (SMEDDS); suitable enough to be an industrially feasible and acceptable dosage form. Methods: Fabrication of pseudo ternary phase diagram was done with suitable oils, surfactants and co-surfactants. The optimized formulation was characterised for droplet size, polydispersity index, zeta potential, cross-polarized light microscopy, thermodynamic stability, viscosity, capsule compatibility and evaluated for in vitro- in vivo parameters. The formulation was tested in animal model for lymphatic uptake with and without chylomicron blocking agent followed by the pharmacokinetic evaluation of the same. Results: The self-emulsification time, droplet size, polydispersity index of the optimized formulation remained unaffected in different media (water, 0.1N HCl and phosphate buffer pH 6.8) over stability conditions and with time. Crossed-polarized light microscopy examination of diluted SMEDDS formulation indicated that the dispersion was an isotropically stable system. The rate of dissolution for SMEDDS formulation was almost double as compared to marketed formulation (Lamisil®). Current investigation indicated a potential for lymphatic uptake of lipid based SMEDDS formulation with enhanced solubility of the candidate drug terbinafine. The optimum formulation of terbinafine SMEDDS when orally administered to rat with and without chylomicron flow blocking agent (cycloheximide) showed the area under the curve (AUC0-48hrs) as 10168.17 ng h/ml and 7425.44 ng h/ml respectively indicating the absorption through the lymphatic route. Thus, the study shows use of SMEDDS formulation for the drug delivery by lymphatic uptake.