Abstract : Microemulsions are clear, transparent, thermodynamically stable dispersions of oil and water, stabilized by an interfacial film of surfactant frequently in combination with a co-surfactant. Microemulsion formulation has been used for the delivery of hydrophilic as well as lipophilic drugs because of its improved drug solubilization capacity, long shelf life, ease of preparation and improved bioavailability. These systems are currently of interest to the pharmaceutical scientist because of their unique characteristics and considerable potential to act as drug delivery carrier by incorporating a wide range of drug molecules. Preparing a pharmaceutically acceptable microemulsion demands a clear understanding of the micro-emulsion structure, phase behavior, factors leading to its thermodynamic stability, factors influencing drug release from the formulation, requirements of ideal microemulsion excipients, and the potential uses and limitations of the microemulsion system. This review highlights potential of Microemulsion as a drug delivery carrier on the basis of various research works on Microemulsion based system.