The aim of the present study was to improve the solubility of poorly water soluble drug lovastatin (LS) by solid dispersion (SD) techniques using modified locust bean gum (MLBG) as a carrier. The locust bean gum (LBG) was modified by heating and there observed irreversible decrease in viscosity, whereas swelling property remains unaffected. The advantage of modification of LBG was illustrated by difference in dissolution profiles of their SD. Effect of polymer concentration and methods of preparation on solubility enhancement were studied using solubility and dissolution studies, respectively. The result of solubility study showed increase in solubility of LS with increase in concentration of MLBG. It was found that the dissolution rate of LS from its SD was dependent on the method of preparation of solid dispersions. Dissolution study revealed that the modified solvent evaporation is most convenient and effective method for solubility enhancement of poorly water soluble drug LS, among various methods of preparation of SD. The prepared SDs were characterized by differential scanning calorimetry, scanning electron microscopy, and X-ray diffraction study. In vivo study was performed by measuring 3-hydroxy-3-methyl-glutaryl-coenzyme A (HMG Co-A) reductase inhibition activity. Significant reduction in HMG Co-A reductase activity was observed in case of solid dispersions of LS than plain LS. In conclusion, MLBG could be used as a potential carrier in enhancing the dissolution rate and bioavailability of LS.