The current research set out to explore the possibility of applying Terbinafine topically using a micro-emulgel formulation. Of the available oil phase, terbinafine had the maximum solubility in propylene glycol. The surfactant and co-surfactant used were Tween 80 and polyethylene glycol 400, respectively. The pseudo-ternary phase diagram was used to determine the 1:2 ratio of co-surfactant to surfactant. Thirteen formulations with different ranges of Smix and oil phase were produced using Central Composite Design. Transmittance was used to determine the final formulation. Maximum transmittance was found in 27.93% of Smix and 6.51% of oil phase based on the optimization plot. The final terbinafine microemulgel was then created using an improved recipe. In order to produce thirteen gel formulations with different concentrations of carbopol 934 and hydroxypropylmethyl cellulose, rheological analysis, drug content, extrudability, spread ibility, and in vitro antifungal activity against Teniapedis were all assessed. Formulations with appropriate consistencies were chosen, and ex-vivo permeation and drug release studies in goat skin were used as the foundation for optimization. Compared to other formulations, the one containing 0.45 grams of carbopol 934 and 0.3 grams of HPMC demonstrated superior drug release and skin penetration. When this formulation was compared to commercially available terbinafine ointment, it was shown to provide improved medication penetration and release.