Acute Respiratory Distress Syndrome (ARDS), associated with Covid-19 infections, is characterized by diffuse lung damage, inflammation and alveolar collapse that impairs gas exchange, leading to hypoxemia and patient' mortality rates above 40%. Here, we describe the development and assessment of 100-nm liposomes that are tailored for pulmonary delivery for treating ARDS, as a model for lung diseases. The liposomal lipid composition (primarily DPPC) was optimized to mimic the lung surfactant composition, and the drug loading process of both methylprednisolone (MPS), a steroid, and N-acetyl cysteine (NAC), a mucolytic agent, reached an encapsulation efficiency of 98% and 92%, respectively. In vitro, treating lipopolysaccharide (LPS)-stimulated RAW 264.7 macrophages with the liposomes decreased TNFα and nitric oxide (NO) secretion, while NAC increased the penetration of nanoparticles through the mucus. In vivo, we used LPS-induced lung inflammation model to assess the accumulation and therapeutic efficacy of the liposomes in C57BL/6 mice, either by intravenous (IV), endotracheal (ET) or IV plus ET nanoparticles administrations. Using both administration methods, liposomes exhibited an increased accumulation profile in the inflamed lungs over 48 h. Interestingly, while IV-administrated liposomes distributed widely throughout the lung, ET liposomes were present in lungs parenchyma but were not detected at some distal regions of the lungs, possibly due to imperfect airflow regimes. Twenty hours after the different treatments, lungs were assessed for markers of inflammation. We found that the nanoparticle treatment had a superior therapeutic effect compared to free drugs in treating ARDS, reducing inflammation and TNFα, IL-6 and IL-1β cytokine secretion in bronchoalveolar lavage (BAL), and that the combined treatment, delivering nanoparticles IV and ET simultaneously, had the best outcome of all treatments. Interestingly, also the DPPC lipid component alone played a therapeutic role in reducing inflammatory markers in the lungs. Collectively, we show that therapeutic nanoparticles accumulate in inflamed lungs holding potential for treating lung disorders. SIGNIFICANCE: In this study we compare intravenous versus intratracheal delivery of nanoparticles for treating lung disorders, specifically, acute respiratory distress syndrome (ARDS). By co-loading two medications into lipid nanoparticles, we were able to reduce both inflammation and mucus secretion in the inflamed lungs. Both modes of delivery resulted in high nanoparticle accumulation in the lungs, intravenously administered nanoparticles reached lung endothelial while endotracheal delivery reached lung epithelial. Combining both delivery approaches simultaneously provided the best ARDS treatment outcome.