Atopic dermatitis (AD) is known as a chronic disease characterized by eczematous and pruritus skin lesions. The pathology behind atopic dermatitis etiology is loss of epidermal barrier, which prevents the production of protein filaggrin that can induce T-cell infiltration and inflammation. Treatment of AD is majorly based on limiting skin repair as well as reducing inflammation and itching. There are several remedies available for the treatment of AD, such as Janus kinase and calcineurin inhibitors, topical corticosteroids, and phosphodiesterase-4 inhibitors. The conventional formulations in the market have limited safety and efficacy. Hence, effective treatment of atopic dermatitis requires the development of novel, efficacious, reliable, and specific therapies. Recent research data have revealed that some naturally occurring medicinal plants have potential applications in the management of AD through different mechanisms. The nanotechnology-based therapeutics have gained a lot of attention in the last decade for the improvement in the activity of drugs having low absorption due to poor solubility, thus leading to lesser bioavailability. Therapies based on nanotechnology can be an effective way to overcome these obstacles. Due to their effective propensity to provide better drug diffusion and bioavailability as well as drug targeting potential at the desired site of action, these approaches may have decreased adverse drug effects, better penetration, and enhanced therapeutic efficacy. Hence, this review highlights the potential of phytoconstituents-based novel formulations for the treatment of atopic dermatitis. Furthermore, recent patents on therapeutic approaches to atopic dermatitis have also been briefly described.