Icariin (ICA) is a flavonol glycoside that has pleiotropic pharmacological actions. It has cytotoxic effects against ovarian cancer cells and increases their chemosensitivity to chemotherapeutic drugs. Phytosomes are identified for their potential in drug delivery of cytotoxic agents. Thus, the purpose of this study was to determine the potential enhancement of ICA cytotoxicity activity in OVCAR-3 ovarian cancer cells via its formulation in phytosomes. ICA-phytosomal formulation was optimized using a Box–Behnken design. Particle size, shape, and in vitro drug release were used to characterize the optimized formula. The optimized formulation exhibited enhanced in vitro drug release. ICA-phytosomes exhibited enhanced cytotoxicity against ovarian cancer cells. Cell cycle analysis indicated accumulation of cells challenged with ICA-phytosomes in G2/M and pre-G1 phases. Staining of cells with annexin V indicated significant elevation of percentage cells with early and late apoptosis as well as total cell death. In addition, the formulation significantly disturbed mitochondrial membrane potential and cellular content of caspase 3. In addition, intracellular release of reactive oxygen species (ROS) was enhanced by ICA-phytosomes. In conclusion, phytosome formulation of ICA significantly potentiates its cytotoxic activities against OVCAR-3 cells. This is mediated, at least partly, by enhanced ICA cellular permeation, apoptosis, and ROS.