PEGylation is the biochemical process of modifying bioactive molecules with polyethylene glycol (PEG), which endows proteins/peptides, antibodies, and vesicles with several desirable properties that are used for the therapy. Protein and Peptide drug delivery systems are considered novel drug delivery systems and have immense therapeutic potential. As a result, using proteins and peptides as therapeutic agents is thought to be a promising strategy for treating a variety of diseases. However, the main limitation with protein and peptide drugs is poor permeation across intestinal mucous barriers and they tend to get rapidly degraded and cleared from the bloodstream. The PEGylation process increases the efficiency of therapeutic proteins by protecting them from proteolytic enzymes. The other advantages include site-specific drug delivery, increased circulation time in the blood, decreased immunogenicity, and prevention or decreased uptake by the reticuloendothelial system. PEGylation of such drugs results in improved physicochemical properties such as an increase in hydrophilicity, size, and molecular weight, changes in conformation, and steric hindrance of intermolecular interaction s. This book chapter discusses about protein and peptide drug delivery and their importance in drug delivery, along with PEGylation and its importance, types of PEGylated nanocarriers, the importance of PEGylation in protein and peptide drug delivery, and characterization of PEGylated nanocarriers. The limitations and strategies to overcome the limitations of PEGylated nanocarriers have also been discussed at length.