The present study is associated with the development of proliposomes and liposomal derived gel for enhanced solubility and permeability of diacerein. Proliposomes were developed by thin film hydration method and converted into the liposomal derived gel using carbopol-934 as a gelling agent. Formulations with varied lecithin to cholesterol ratios were investigated to obtain the optimal size, entrapment efficiency, and enhanced in vitro dissolution. Dynamic light scattering analysis revealed the particle size and zeta potential in the range of 385.1±2.45-762.8±2.05 nm and -22.4±0.55-31.2±0.96mV respectively. Fourier transform infrared (FTIR) spectroscopic analysis depicted the physicochemical compatibility, powdered x-ray diffraction (PXRD) analysis predicted the crystalline nature of pure drug and its transition into amorphous form within formulation. The differential scanning calorimetry (DSC) demonstrated the thermal stability of the formulation. The in vitro drug release study using dialysis membrane displayed the enhanced dissolution of diacerein due to the presence of hydrophilic carrier (Maltodextrin) followed by sustained drug release due to the presence of lipid mixture (lecithin and cholesterol). Ex vivo permeation studies depicted 3.50±0.27 and 3.21±0.22 folds enhanced flux of liposomal gels as compared to control. The acute oral toxicity study showed safety and biocompatibility of the system as no histopathological changes in vital organs were observed. These results suggests that proliposomes and liposomal derived gel are promising candidates for the solubility and permeability enhancement of diacerein in the management of osteoarthritis.