We report the synthesis and surface modification of bio-friendly ZnO based colloids, which have been used for cancer cell detection providing significant advantages on quantum confinement effects, high emission brightness in UV to blue-violate range, non-toxicity and a unique dual color imaging feature. The ZnO nanoparticles were single crystal nanoparticles having spherical shape in size of 1-2 or 4-5 nm depending on the surface capping agents. All the colloidal solutions were stable for 30-45 days. The surface capping is a more effective technique in controlling the nanoparticle size, while dopants are effective in modifying the bandgap and optical properties. Unique dual colour images with blue colour in nucleus and turquoise colour in cytoplasm were obtained using either pure ZnO or Co doped ZnO colloids on human osteosarcoma (Mg-63) cells. The dual colour function is the combined effects of quantum confinement and the bio-compatible surface capping groups. The cytotoxicity study proved no cell proliferation by the nanoparticles up to the concentration of 1000 µg/mL, which is the highest concentration reported so far. Since a dosage of only 50-100µM is enough for the in vivo detection on rate, these ZnO colloids have high potential for use as the detection media for Labon-a-Chip devices.