This invention describes the use of anti-TNF-a antibody as a targeting agent attached to liposomes incorporating anti-inflammatory drugs to treat arthritis and other inflammatory diseases. A variety of steroidal and non-steroidal drugs and disease modifying drugs and other anti-inflammatory compounds may be incorporated into the anti-TNF-a coated liposomes. The anti-TNF-a coated drug liposomes will accumulate within the inflamed site where the drug is released for maximum therapeutic effect. Other nanosized drug delivery vehicles such as dendrimers, micelles, nanocapsules and nanoparticles may be similarly coated with anti-TNF-a antibody and used to deliver the drug to the site of inflammation. Also in lieu of the anti-TNF-a antibody other TNF-a binding agents such as aptamers and binding peptides may be used to coat the various nanosized drug delivery vehicles such as micelles, dendrimers, nanocapsules and nanoparticles in order to deliver the drug to the site of inflammation.