Fluocinolone topical is used to treat the itching, redness, dryness, crusting, scaling, inflammation, and discomfort of various skin conditions, including psoriasis (a skin disease in which red, scaly patches form on some areas of the body and eczema (a skin disease that causes the skin to be dry and itchy and to sometimes develop red, scaly rashes). Fluocinolone is in a class of medications called corticosteroids. It works by activating natural substances in the skin to reduce swelling, redness, and itching.