Finasteride is considered the drug of choice for androgenic alopecia and benign prostate hyperplasia. The aim of the study was to formulate nanodrug carriers of finasteride with enhanced retentive properties in the skin. The finasteride was formulated as solid lipid nanoparticles that were decorated with different concentrations of chitosan for improved retentive properties. Solid lipid nanoparticles (SLNs) were synthesized by “high-speed homogenization technique” using stearic acid as a solid lipid while PEG-6000 and Tween-80 were used as surfactants. The SLNs were evaluated for particle size, polydispersity index (PDI), zeta potential, drug entrapment efficiency, and drug release behavior. The mean particle size of SLNs was in the range of 10.10 nm to 144.2 nm. The PDI ranged from 0.244 to 0.412 while zeta potential was in the range of 8.9 mV to 62.6 mV. The drug entrapment efficiency in chitosan undecorated formulations was 48.3% while an increase in drug entrapment was observed in chitosan-decorated formulations (51.1% to 62%). The in vitro drug release studies of SLNs showed an extended drug release for 24 hours after 4 hours of initial burst release. The extended drug release was observed in chitosan-coated SLNs in comparison with uncoated nanoparticles. The permeation and retention study revealed higher retention of drug in the skin and low permeation with chitosan-decorated SLNs that ranged from 39.4 μg/cm2 to 13.2 μg/cm2. TEM images depicted spherical shape of SLNs. The stability study confirmed stable formulations in temperature range of 5°C and 40°C for three months. It is concluded from this study that the SLNs of finasteride were successfully formulated and chitosan decoration enhanced the drug retention in the skin layers. Therefore, these formulations could be used in androgenic alopecia and benign prostate hyperplasia to avoid the side effects, drug degradation, and prolonged use of drug with conventional oral therapy.