Solid lipid nanoparticles (SLN) are very potential formulations for topical delivery of anti-inflammatory and anti-arthritic drugs. The solid state of the lipid particles enable efficient drug encapsulation and controlled drug release. In the present study, the evaluation of different formulation parameters based on variation of concentration of lipid and cosurfactant was studied. The SLN gel formulations of the dispersions were compared to the SLN dispersions and with the marketed gel of aceclofenac. The SLNs were prepared by high speed homogenization and ultra-sonication method with fixed amount of aceclofenac (10%) and pluronic F68 (1.5%). The particle size, zeta potential and span of developed formulations was found to be within the range of 123 nm to 323 nm, -12.4 to -18.5 and 0.42 to 0.86 respectively as the lipid concentration was increased from 7.5% to 40%. The highest entrapment efficiency was found to be 75% with the formulation having lipid concentration of 30% and 0.85% of phospholipon 90G. Permeation rate and controlled release property of xanthan gum loaded SLN gel formulations and SLN dispersion was studied through excised pig skin for 24hr. The drug release of SLN gel formulations was better controlled as compare to SLN dispersions. In vivo anti-inflammatory study showed that action of aceclofenac was enhanced for SLN dispersion and gel formulations. The results indicated the superiority of SLN based formulations for topical delivery of aceclofenac.