Liposomes are lipid-based bilayer vesicles that have become promising tools for cancer therapy and drug delivery. They have structural similarity with cells and have the capability of encapsulating both hydrophobic and hydrophilic drugs that could improve the stability and bioavailability of therapeutic compounds. They can be engineered with various polymers, linkers, or targeting moieties to enhance their stability, minimize the off-target effects, improve their accumulation at targeted sites, enhance their therapeutic performance, and reduce the systemic toxicity. In this chapter, we have discussed these types of nanoformulations, their classification, different methods used for their preparation, and their applications in drug delivery and cancer therapy, with a particular emphasis on cancer immunotherapy.