The high worldwide incidence of both acute and chronic pain leads to widespread consequences for both the healthcare system and the economy. First-line pain treatment options are typically oral pain medications; however, concerns regarding side effects, prescription drug abuse, risk of overdose, patient non-adherence to treatment regimens, and lack of efficacy in certain conditions provide a number of challenges for both healthcare providers and patients. As a result, healthcare providers have become increasingly interested in new ways to manage pain and develop customized treatment plans for their patients. Compounded transdermal pain medication may offer benefits such as customizable dosages and formulations, the ability to combine multiple drugs with various mechanisms of action, the likelihood of lower systemic absorption with minimization of side effects, more convenience and consequent improved adherence to treatment regimens, and minimization of risk of abuse and addiction. This review offers an overview of examples to provide evidence of the benefits of transdermal compounded pain medication in the treatment of a number of pain-related conditions, including neuropathic, musculoskeletal, arthritis-related, and postoperative pain, among other conditions.