Rheumatoid arthritis (RA) is a chronic inflammatory disease that severely affects joints and restricts locomotion. Various treatment regimens are available for RA, providing short-term relief from pain, but long-term relief from the disease is still not available. Evidently, cytokines play a crucial role in the pathophysiology of the disease. However, aberrant immune responses, genetic dispositions, viral infections, or toxicants are some possible causative mediators of RA. The synovial fluid of rheumatoid arthritis patients encompass cytokines, especially osteoclastogenic cytokines, and invasion factors such as macrophage colony-stimulating factor (M-CSF) and the receptor activator of NF-κB ligand (RANKL). Moreover, tumor necrosis factor-α (TNF-α) and interleukins (IL-1, 6, and 17) intensify osteoclast differentiation and activation. Therefore, in order to restrict the cytokine expression, we used budesonide as a therapeutic lead and encapsulated it into a highly biocompatible hydrogel system. The hydrogel system developed by us is enzyme-responsive and provides sustained drug release flow over an extended period of time. This hydrogel is characterized by ζ-potential analysis, field-emission scanning electron microscopy (FE-SEM), and attenuated total reflectance-Fourier transform infrared (ATR-FTIR) spectroscopy, and it is further encapsulated with budesonide (glucocorticoids) for therapeutic purposes. Evidently, Bud-loaded ER-hydrogel showed improvement in joint physiology compared to the disease group and downregulated the inflammatory markers.