Diabetic retinopathy is the most common complication of diabetes and remains the leading cause of vision loss worldwide. The potent glucocorticoid based anti-inflammatory drug dexamethasone (DEX) chosen for the present work is long-acting with half-life of 37–72 h extensively metabolized in to 6-hydroxy-dexamethasone (6-OH-DEX). The present work aimed to develop dexamethasone loaded nanodispersion (DEX-ND) by improving its solubility, half-life, and bioavailability in biological system thereby this formulation may be afforded economically. With the concept that polymeric surfactant improves the solubility of challenging water insoluble drug the present work has been hypothesized to improve its solubility using polyvinyl pyrrolidone (PVP-K30) polymer and polysorbate 80 (Tween 80) hydrophilic non-ionic surfactant, thereby the bioavailability is expected to get enhanced. By varying the PVP K30 and Tween 80 concentrations three different formulations were developed. The developed DEX-ND was further characterized for its compatibility, particle size, zeta potential, morphology, and in vitro release behavior. The results of Fourier transform infrared spectrometric analysis indicate the compatibility nature of DEX-ND along with other excipients/drug used in the formulation. The developed formulations showed spherical morphology, particle size ranging from 550.46 ± 107.82 to 3560 ± 284.29 nm, zeta potential ranging from −29.23 ± 1.09 to −7.793 ± 1.01 mV. The amount of DEX present in the DEX-NDs was found to be 0.95–3.93 mg. The in vitro release studies as performed by dialysis bag method showed a sustained release pattern. The results of ex vivo corneal permeation studies indicates that the developed DEX- NDs has some exposure to the posterior segment of the eye.