Nanocarriers have transformed drug delivery by providing targeted and regulated distribution of therapeutic agents, as a result increasing efficacy and decreasing side effects. Among the various approaches used to maximize the performance of nanocarriers, polyethylene glycol (PEG)ylation has attracted a lot of interest due to its capacity to improve biocompatibility and extend the duration of circulation in vivo. Conventional PEGylation, often result in unsatisfactory therapeutic payload delivery and less cellular absorption. A potential solution to these issues is reversible PEGylation, which preserves effective drug release with cellular incorporation while providing the advantages of extended circulation. This review examines the principles and uses of reversible PEGylation in drug delivery and nanocarrier design. At one point, the review also examines the effects of reversible PEGylation concerning the pharmacokinetics, biodistribution and colloidal stability of nanocarriers. A discussion on the translational opportunities and difficulties related to reversible PEGylation, including stability, scalability, and regulatory issues is also incorporated.