In the pharmaceutical industry, orally active compounds are required to have sufficient water solubility to enable dissolution within the gastrointestinal tract prior to absorption. Limited dissolution within the gastrointestinal tract often reduces the bioavailability of hydrophobic drugs. To improve gastrointestinal tract dissolution, nonaqueous solvents are often used in the form of emulsions and microemulsions. Here, we show that oil-free polyelectrolyte nanosystems (micellar dispersions and 100 - 300 nm particles) prepared from poly(ethylenimines) derivatized with cetyl chains and quaternary ammonium groups are able to encapsulate high levels of hydrophobic drug (0.20 g of drug per g of polymer) for over 9 months, as demonstrated using cyclosporine A (log P = 4.3). The polyelectrolytes facilitate the absorption of hydrophobic drugs within the gastrointestinal tract by promoting drug dissolution and by a hypothesized mechanism involving paracellular drug transport. Polyelectrolyte nanoparticle drug blood levels are similar to those obtained with commercial microemulsion formulations. The polyelectrolytes do not promote absorption by inhibition of the P-glycoprotein efflux pump.