The present work aimed to design nanosponge based hydrogel formulation containing psorlen to enhance topical delivery. Material and Method: The different polymers at various ratios were used to formulate the nanosponges (F1 to F 12). The nanosponges (NS) were studied for entrapment efficiency, particle size, structural properties, size and appearance, and in vitro drug release. The formulation was further evaluated for its anntipsoriatic potential. Result and Discussion: After primary evaluation formulations F3, F5, F7 and F12 were selected for further studies including drug release and FESM. The nanosponges (F5) made using PVA: EC (1:1) were determined to be superior in the in-vitro release testing and were subsequently selected for antipsoriatic potential investigation. Conclusion: It was concluded that the formulation F5 showed better antipsoriatic potential was evaluated by topical application of formulation to oxazolone induced psoriasis in mice for 16 days.