Herbal extracts have essential properties such as antioxidant, antimicrobial, hepatoprotective, neuroprotective, anticancer, etc. Although these valuable compounds have potential therapeutic effects, their application is limited due to their poor solubility, stability, bioavailability, and gastric degradation, which lead to lower biological activity. Phospholipid-based delivery systems, namely liposomes, have been introduced as versatile assemblies to overcome these limitations of herbal extracts. Liposomes are effective carrier systems for the delivery of herbal extracts with improved therapeutic effects by enhancing their limitations. In this review, we summarized the characteristics of liposomal delivery systems used for herbal extracts with their applications and limitations.