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Carteolol (CRT) is currently under development as a potential therapeutic agent for the treatment of open angle glaucoma. The purpose of the present work is to develop and validate a stability indicating assay method and its application to estimate CRT in aqueous humour and study the pharmacokinetic parameters. An ultra performance liquid chromatographic tandem mass spectroscopy (UPLC–MS/MS) method was developed and validated for the quantitative determination of CRT in rabbit aqueous humour, using propranolol as the internal standard (I.S.). Aqueous humour samples were prepared by a simple liquid–liquid extraction technique (LLE). The analyte and internal standard were separated by an Acquity UPLC BEH C18 (100.0 × 2.1 mm; 1.7 μm) column with a mobile phase of acetonitrile – 2 mM (milli mole) ammonium acetate (90/10, v/v) over 3 min of retention time. Detection was based on the multiple reactions monitoring with the precursor-to-product ion transitions m / z 293.2 → 237.12 for CRT and m / z 260.09 → 183.04 for I.S. The method was validated according to FDA guidelines on the bio-analytical method validation. The method developed was linear ( r 2 = 0.999) over the concentration range of 1–1000 ng/mL. The selectivity, sensitivity, linearity, accuracy, precision, extraction recovery, and stability were within the acceptable ranges. Forced degradation studies were performed on bulk sample of CRT as per ICH prescribed stress conditions, such as acid, base, oxidative and photolytic to show the forced of the method. Significant degradation was observed during basic stress condition. The pharmacokinetic study of CRT solution and nanoparticles in aqueous humour of rabbit eye was performed and results showed that CRT nanoparticles enhance the ocular bioavailability by 5.61-fold as compared to CRT-solution. [ABSTRACT FROM AUTHOR]