Conventional drug delivery approaches are plagued by issues pertaining to systemic toxicity and repeated dosing. Hydrogels offer convenient drug delivery vehicles to ensure these disadvantages are minimized and the therapeutic benefits from the drug are optimized. With exquisitely tunable physical properties that confer them great controlled drug release features and the merits they offer for labile drug protection from degradation, hydrogels emerge as very efficient drug delivery systems. The versatility and diversity of the hydrogels extend their applications beyond targeted drug delivery also to wound dressings, contact lenses and tissue engineering to name but a few. They are 90% water, and highly porous to accommodate drugs for delivery and facilitate controlled release. Herein we discuss hydrogels and how they could be manipulated for targeted drug delivery applications. Suitable examples from the literature are provided that support the recent advancements of hydrogels in targeted drug delivery in diverse disease areas and how they could be suitably modified in very different ways for achieving significant impact in targeted drug delivery. With their enormous amenability to modification, hydrogels serve as promising delivery vehicles of therapeutic molecules in several disease conditions, including cancer and diabetes.