Thalidomide (THD), a synthetic derivative of glutamic acid, was initially used as a sedative and antiemetic until the 1960s, when it was found to cause devastating teratogenic effects. However, subsequent studies have clearly demonstrated the anti-inflammatory, anti-angiogenic, and immunomodulatory properties of thalidomide, thus providing a rationale for its current use in the treatment of various autoimmune diseases and cancers. Our group found that thalidomide can suppress the regulatory T cells (Tregs), a minor subset of CD4 T cells (~10%) with unique immunosuppressive activity that have been shown to accumulate in the tumor microenvironment (TME) and represent a major mechanism of tumor immune evasion. Due to the low solubility of thalidomide in its present form of administration, coupled with its lack of specificity for targeted delivery and controlled drug release, it is an urgent need to find potent delivery methods that can significantly enhance its solubility, optimize the desired site of drug action, and mitigate its toxicity. In this study, the isolated exosomes were incubated with synthetic liposomes to form hybrid exosomes (HEs) that carried THD (HE-THD) with uniform size distribution. The results demonstrated that HE-THD could significantly abrogate the expansion and proliferation of Tregs induced by TNF, and this might result from blocking TNF-TNFR2 interaction. By encapsulating THD in hybrid exosomes, our drug delivery system successfully increased the solubility of THD, laying a foundation for future in vivo experiments that validate the antitumor activity of HE-THD by reducing the Treg frequency within the tumor microenvironment.