This article describes the development, optimization, and evaluation of Carbopol 940 topical gel containing aceclofenac-crospovidone (1:4) solid dispersion using "Quality by Design (QbD)" approach based on 23 factorial design. The effect of crospovidone, tri-ethanolamine, and ethyl alcohol amount on the drug permeation profile of the topical gel containing aceclofenac-crospovidone solid dispersion was optimized by 2(3) factorial design. The optimized gel showed improved permeation profile with cumulative drug permeation of 26.262 +/- 2.157%, and permeation flux of 0.059 +/- 0.011 mu g/cm(2)/h. These gels were characterized by pH, viscosity, gel strength and FTIR study. The in vivo anti-inflammatory activity of the optimized gel was evaluated in rats using carrageenan-induced rat-paw oedema model and found excellent anti-inflammatory comparable with a marketed gel without producing any skin irritation. (C) 2014 The Institution of Chemical Engineers. Published by Elsevier B.V. All rights reserved.