Breast cancer remains the leading cause of cancer-related mortality worldwide, with current therapeutic options constrained by systemic toxicity, multidrug resistance, and poor tumor specificity. Nanocarrier-based drug delivery systems have emerged as a promising strategy to overcome these limitations, among which liposomes are extensively explored owing to their biocompatibility, structural versatility, and improved pharmacokinetics. Clinically approved liposomal formulations such as Doxil® (PEGylated doxorubicin) and Myocet® (non-PEGylated doxorubicin) demonstrate improved pharmacokinetic profiles over free drug, yet rely solely on passive tumor accumulation via the enhanced permeability and retention (EPR) effect, an approach rendered insufficient by tumor heterogeneity and variable vascularization, necessitating active targeting strategies. Transferrin receptor 1 (TfR1; CD71) is overexpressed in rapidly proliferating breast cancer cells, representing a compelling therapeutic target. Transferrin (Tf)-functionalized liposomes exploit the natural Tf-TfR1 pathway to enable receptor-mediated endocytosis, enhancing intracellular drug delivery with greater tumor specificity. While prior reviews have addressed liposomal delivery or transferrin-mediated targeting in isolation, a comprehensive synthesis integrating transferrin biology, TfR1 overexpression across breast cancer subtypes, and translation evidence remains lacking. This review provides a mechanistic and translational overview of Tf-functionalized liposomal systems exclusively in the context of breast cancer, encompassing liposome architecture, transferrin biology, TfR1-mediated uptake, and conjugation strategies, alongside a critical appraisal of preclinical evidence. Despite their promise, clinical translation remains constrained by TfR1 receptor saturation, off-target uptake, conjugation-induced immunogenicity, anti-PEG antibody-mediated accelerated blood clearance, and GMP-compliant manufacturing challenges. Overcoming these barriers through pharmacokinetic optimization, standardized quality control, and scalable fabrication is imperative to unlock their full therapeutic potential in breast cancer.