A pioneering nucleus-targeting dual-functional thermosensitive bubble-generating liposome as drug carrier has been developed with conjugated cell penetrating peptide and photothermal agent (CDs) for multi-color cell imaging and combination (chemo- and photothermal) therapy of cancer, using doxorubicin as drug molecule. The liposome was prepared by ‘in-house’ synthesized precursors molecules, to reduce the cost of production in comparison to the earlier reported liposomes. This drug carrier was proposed to target nucleus of the cancer cells, owing to specific and selective cell-penetrating property of TAT, followed by burst but stable drug release due to decomposition of bubble forming agent present inside the liposome core, by being subjected to near-infrared (NIR) irradiation (i.e. photothermal conversion of radiation to heat). The in-vitro temperature and/or NIR-triggered release study indicated that liposome was sensitive towards heat and able to generate the sufficient temperature of 68°C in the presence of NIR-laser source. The in vivo experiment was also performed to explore the NIR-responsive hyperthermia in the mice body. The as prepared bubble containing liposome-based drug delivery system exhibits superior stability, no drug leakage and enhanced in vitro and in vivo drug delivery with efficient cancer cell killing via combination therapy. The multicolor fluorescence obtained via CDs improves the accuracy of the cell imaging study as well as works as a key component for photothermal treatment of cancer. The results obtained in the study demonstrated that the designed smart drug carrier have great potential in the field of cancer theragnosis i.e. imaging, targeted drug delivery, and treatment.