Osteoarthritis (OA) is the most common joint disease worldwide causing cartilage loss, inflammation and pain. Lorecivivint (LOR) is a new disease-modifying osteoarthritis drug (DMOAD) that targets the Wnt pathway to improve cartilage regeneration and reduce the pro-inflammatory cytokines production. However, its advancement in the clinical evaluation is facing certain challenges due to poor solubility and fast clearance from the joint. Our study is the first to improve LOR delivery using cationic liposomes for intra-articular injection. DSPC-Chol-DOTAP-based liposomes were formulated using microfluidics with an encapsulation efficiency (EE) of 36 % of LOR and increasing the drug solubility over 120-fold in PBS and 100-fold in simulated synovial fluid. In a physiological environment, a prolonged release of 17 % of the LOR over 14 days was achieved, while faster release of 65 to 86 %, respectively, was observed in simulated synovial fluid. The surface charge of + 35 mV and the size of 145 nm were influential in increasing cartilage uptake in bovine explant of 1.4-fold and 3.6-fold compared to free LOR solution and suspension, respectively. In vitro study by flow cytometry revealed there was no cytotoxicity at 10 nM in human chondrocytes (hCHs) and in human mesenchymal stem cells (MSCs). Nevertheless, some toxicity-related morphological changes in hCHs spheroids were observed at 300 nM, which corresponds to the IC80 of LOR. The safer liposomal concentration of 10 nM maintained the drug bioactivity and reduced by half TGF-β and IL-6 levels in two-dimensional hCHs and MSCs cell culture, which confirmed the anti-fibrotic and anti-inflammatory effects. An in vivo pilot study was conducted using a severe ACLT-hMnX rat model showing preliminary evidence of an alleviated osteophyte formation and reduced cartilage matrix loss in the medial tibial plateau. Overall, Lipo-LOR improved drug solubility, release and cartilage retention, which are critical requirements for implementing a localized intra-articular OA therapy.