Semiconductor quantum dots (QDs) have achieved initial success as biomedical imaging agents. However, significant cytotoxicity in the biological environment prohibits their use in vivo. Here, we introduce nanocomposites composed of carbon dots (C-dots) in poly(lactic-co-glycolic acid) (PLGA) carriers as possible imaging agents for in vivo applications. An initial hurdle to clinical use is overcome by synthesizing C-dots with commercially available carbon black precursors, permitting scalable nanomanufacturing. These fluorescent nanoparticles, which have a mean diameter of ~1 nm, display a disordered graphitic structure. To overcome a second clinical hurdle (i.e., rapid renal clearance of nanoparticles <~6 nm in diameter), C-dots were encapsulated in biodegradable PLGA nanospheres. The resulting nanocomposites showed a mean diameter of 344 ± 23 nm, which should reduce renal clearance. With further optimization, nanocarriers could be optimized to sizes <200 nm to reduce accumulation in the reticuloendothelial system (RES). Toxicity of both C-dots and C-dot-PLGA nanocomposites was evaluated using HepG2 liver cell lines. Unlike QDs, which can induce toxicological responses at concentrations as low as 0.005 mg/mL, C-dots exhibited cytotoxicity at concentrations greater than 0.2 mg/mL, while their derived nanocomposites did not exhibit cytotoxicity at any concentration tested (i.e., 0.02 mg/mL, 0.1 mg/mL and 0.2 mg/mL).