Context: Raloxifene hydrochloride (RLH), a selective estrogen receptor modulator, shows antiproliferative and apoptotic effects on Leiomyoma. Its extensive first pass metabolism leads to oral bioavailability of 2%. Objective: The aim of this investigation was to formulate RLH-loaded liposomes and study its uterine-targeting efficiency after intravaginal administration. Materials and methods: Liposomes were prepared by thin film hydration method using 1:1 molar ratio of DSPC:Cholesterol and characterized for vesicle size, zeta potential, %entrapment efficiency, loading, drug release and transmission electron microscopy. Radiolabeling of RLH was performed with reduced technetium-99m ( 99m Tc). Binding affinity of 99m Tc-labeled complexes was assessed by diethylene triamine penta acetic acid (DTPA) challenge test. Biodistribution study was done in New Zealand white female rabbits by administering the formulation intravaginally. Results and discussion: Spherical and discrete liposomes of size 119 nm were seen in TEM results. Liposomes had high entrapment efficiency of 90.96% with drug loading of 27.25%w/w. Liposomes were able to sustain the drug release for 6 days. Tc-labeled complexes showed high labeling efficiency and stability both in saline and serum. DTPA challenge test confirmed low transchelation of 99m Tc-labeled complexes. Biodistribution study by gamma scintigraphy revealed the preferential uptake of the formulation by uterus when administered vaginally. Compared to plain drug, liposomes were concentrated and retained within the uterus for a longer period of time. Conclusion: Uterine targeting of RLH-loaded liposomes indicates its potential to overcome the limitations of marketed formulation. Drug targeting to site of action anticipates dose reduction needed to elicit the therapeutic effect.