Topical photodynamic therapy (PDT) is a non-invasive technique used in the treatment of malignant and non-malignant skin diseases. It offers great promise because of its simplicity, enhanced patient compliance, localisation of the photosensitizer, as well as the use of light and oxygen to achieve photocytotoxicity. Despite progress in photosensitizer-mediated topical PDT, its clinical application is limited by poor penetration of photosensitizers through the skin. Therefore, much effort has been made to develop nanocarriers that can tackle the challenges of conventional photosensitizer-mediated PDT for topical delivery. This review discusses recent data on the use of different types of lipid-based nanocarriers in delivering photosensitizer for topical PDT.