The variable domain of the heavy chain antibodies (VHHs) is the smallest (15 kDa) intact single domain antigen-binding fragment. VHHs often exhibit sub-nanomolar affinity for their designated targets and therefore are receiving increasing attention in molecular targeting and nanomedicine engineering. We cloned and expressed four non-overlapping anti-HER2 VHHs in a prokaryotic expression system that yielded disulfide-bonded VHHs. Purified VHHs, before and after thiolation, were characterized by Western blot and their functionality against the ecto-domain of HER2 receptor was confirmed by ELISA and flow cytometry. Thiolated VHHs were conjugated to the reactive maleimide-PEG2000-distearoylphosphatidylethanolamine incorporated into the bilayer of small unilamellar vesicles. We show high target-binding avidity and efficient cytotoxicity of optimized tetra-specific multivalent methatoraxate-loaded VHH-PEG-liposomes (55–60 VHH/vesicle) in HER2 over-expressing breast carcinoma cell lines compared with the best performing monoclonal VHH conjugated vesicles of identical VHH surface density. The VHH expression and production methodology as well as the synergistic effect of the four non-overlapping VHHs in HER2 binding provides an efficient approach for design and engineering of anti-cancer nanomedicines and their future applications within the context of personalized and precision therapies and diagnostics are discussed.