Purpose: The eye drops are the prominent preparation used to treat surface eye disease (bacterial conjunctivitis). However, they have some limitations i.e., short corneal residence, resulting in low ocular bioavailability and necessitating frequent dose administration. The present study developed gentamicin (GE) bilosomes (BM)- laden in-situ gel to improve therapeutic activity. The in-situ gel system is initially in sol form before administration and converted into gel form in physiological eye conditions. Method: The GE-BM was developed using the thin film hydration technique and optimized by D-optimal design. GE-BM was characterized for vesicle size, entrapment efficiency, zeta potential, morphology, and FTIR. The optimized GE-BM (GE-BMopt) was incorporated into an in-situ gel and assessed for physicochemical characteristics. GE-BMopt in-situ gel was evaluated for in-vitro release, ex-vivo permeation, toxicity, and antimicrobial study. Result: GE-BMopt has a vesicle size of 185.1±4.8nm, PDI of 0.254, zeta potential of 27.6 mV, entrapment efficiency of 81.86±1.29 %, and spherical morphology. The FTIR study presented no chemical interactions between GE and excipients. GE-BMopt in-situ gel (GE-BMoptIG4) showed excellent viscosity, gelling strength, and ex-vivo bio-adhesion. GE-BMopt-IG4 showed significant high and sustained release of GE (78.08± 4.73% in 12h). GE-BMopt-IG4 displayed 3.27-fold higher ex-vivo goat corneal permeation than a pure GE solution. GE-BMopt-IG4 showed good corneal tolerance without any damage or irritation. GE-BMopt-IG4 showed significantly (P<0.05) higher anti-bacterial activity (ZOI) against Staphylococcus aureus and Escherichia coli than pure GE solution. Conclusion: The study determined that the BM in-situ gel system can serve as a substitute carrier for GE to enhance its therapeutic effectiveness, and further preclinical studies are required.