In this study, we tested the hypothesis that a cell permeable peptide, CARSKNKDC (CAR), conjugated nanoerythrosomes (NERs) containing fasudil, a rho-kinase (ROCK) inhibitor, produces prolonged pulmonary preferential vasodilation. CAR conjugated NERs containing fasudil were prepared by hypotonic lysis and extrusion method, and optimized for various physicochemical properties in-vitro. The formulations were then used to study the hemodynamic efficacy in a monocrotaline-induced rodent model of pulmonary arterial hypertension (PAH). CAR-NERs-Fasudil was spherical in shape with an average vesicle size and entrapment efficiency of 161.3 ± 1.37 nm and 48.81 ± 1.96%, respectively. Formulations were stable for ~3 weeks when stored at 4 °C and the drug was released in a controlled fashion for >48 h. The uptake of CAR-NERs-Fasudil by TGF-b activated pulmonary arterial smooth muscle cell was ~1.5-fold greater than the uptake of NERs-Fasudil. CAR-NERs-Fasudil inhibited ROCK activity and 5-hydroxytryptamine induced cell proliferation. In terms of reduction of pulmonary arterial pressure, intratracheal administration of CAR-NERs-Fasudil was ~2-fold more specific to the lungs compared with plain fasudil. Overall,CAR peptide grafted nanoerythrosomes offers a new platform for improving the therapeutic efficacy ofa rho-kinase inhibitor, fasudil, without affecting peripheral vasodilation.