Objectives: Topical nanoemulsion diclofenac gels have been introduced on the premise that they act by penetration and accumulation in underlying structures. The other principle of action of topical preparations is “The gate theory of pain” or “Counter irritant principle”. Relative merit of these theories in clinical settings is not known. We compared the clinical efficacy of plain nanoemulsion diclofenac gel with topical preparations that include methyl salicylate, in osteoarthritis of knee. Methods: 200 patients were randomly allocated to either plain diclofenac (1% w/w) nanoemulsion gel (Group D) or diclofenac (1% w/w) with methyl salicylate (10% w/w) (Group DS) or topical methyl salicylate (30% w/w) (Group S) or placebo (petroleum jelly) (Group P). Mean change in VAS score and mean change in WOMAC index was calculated for each group at end of three weeks and compared using Mann-Whitney U test. 50% reduction in VAS score and 50% improvement in modified WOMAC index was considered as “successful treatment” for Numbers Needed to Treat (NNT) analysis. Results: 163 patients were available for final follow up. Both Group D and Group DS showed significant improvement compared to Group P. Group S however did not show significant clinical improvement. Comparing Group D and Group DS, the combination topical preparation showed significant better clinical efficacy. Rate of adverse events in all groups was remarkably low. Conclusion: Combination of topical diclofenac with methyl salicylate was better than topical diclofenac alone, indicating additive effect. Patients who tolerate the counter – irritation may benefit with addition of salicylates to topical diclofenac.