The aim of the current investigation was to improve dissolution rate, gastric absorption and tolerance of a water insoluble non-steroidal anti-inflammatory drug ketoprofen by developing proliposomal powders. Ketoprofen proliposomal powders were prepared by solvent evaporation method with varying ratios of hydrogenated soyphosphatidyl choline (HSPC) and cholesterol. The prepared proliposomal powders were characterized for vesicle size, micromeritics, entrapment efficiency and in vitro dissolution behavior. Proliposomal powder (KPL3) composed of equimolar ratios of HSPC and cholesterol loaded on pearlitol SD 200 was selected as optimized formulation as it produced smaller liposomes (5.24 ± 1.35 μm) upon hydration with highest entrapment efficiency (53.16 ± 0.06%). All proliposomal powders showed improved dissolution characteristics than pure drug, however dissolution of drug from KPL3 was found to be highest (91.17 ± 6.3) and which is about 24 times higher than pure ketoprofen within 5 min. The transformation of crystalline ketoprofen to amorphous form was confirmed by solid state characterization. The absorption rate per hour for pure ketoprofen and proliposomal formulation (KPL3) was assessed in the stomach by conducting in situ gastric absorption studies in Wistar rats and was found to be 27 ± 1.22 and 36.98 ± 1.95%, respectively. In conclusion, enhanced dissolution and gastric absorption rate of ketoprofen from proliposomal powders suggest them as potential candidate for oral bioavailability improvement of ketoprofen.