Phytochemicals from medicinal plants offer significant therapeutic benefits, yet their clinical utility is often limited by poor solubility, instability, and low bioavailability. Nanotechnology presents a transformative approach to overcome these challenges by encapsulating phytochemicals in nanocarriers that enhance stability, targeted delivery, and controlled release. This review highlights major classes of phytochemicals such as polyphenols, flavonoids, and alkaloids and explores various nanocarrier systems including liposomes, polymeric nanoparticles, and hybrid platforms. It also discusses their mechanisms of action, improved pharmacokinetics, and disease-specific targeting. Further, the review examines clinical advancements, regulatory considerations, and emerging innovations such as smart nanocarriers, AI-driven formulation, and sustainable manufacturing. Nano-phytomedicine offers a promising path toward safer, more effective, and personalized therapies, bridging traditional herbal knowledge with modern biomedical technology.