A lipid-based nanocarrier system is a novel technique for the delivery of poorly soluble drugs through topical delivery. This study developed a dual-drug (luliconazole: LZ, and niacinamide: NM) loaded lipid nanocarrier (LN)-laden gel for the treatment of vaginal candidiasis. The LNs were prepared using cholesterol and soya-α-lecithin through a thin-film hydration technique. The average vesicle size, polydispersity index, and zeta potential of the optimized LZNMLNs were 126.40 ± 1.30 nm, 0.276, and -34.6 ± 0.8 mV, respectively, and the formulation showed the sustained release of both drugs over an extended period. Selected LZNMLNs were incorporated into a bio-adhesive gel. The optimized LZNMLNs-gel showed excellent viscosity, spreadability, and bio-adhesiveness. The optimized LZNMLNs-gel exhibited significantly higher permeation of LZ (1.46-fold) and NM (1.55-fold) than LZNM gel. The optimized LZNMLNs-gel showed significantly higher antifungal activity (ZOI = 34 ± 2 mm) than commercial Candid V gel (18 ± 1 mm). The optimized LZNMLNs-gel did not show any cytotoxicity against vaginal epithelial cells. The bioavailability of LZNMLNs-gel was significantly ( < 0.05) increased (1.94-fold for LZ and 1.33-fold for NM) compared to Candid V, with a decrease in total clearance indicating sustained release of the drug, which may lead to the maintenance of therapeutic concentration for an extended period. antifungal activity showed that the optimized LZNMLNs-gel completely treated the infection on the 7th day of treatment in an induced rabbit model, compared to the commercial gel (Candid V gel, 10 days). Based the findings, it can be concluded that LN-laden gel is an alternative carrier for improvement of the topical delivery of drugs for the treatment of vaginal candidiasis.