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Food grade nanoemulsions are being increasingly used in the food sector for their physico-chemical properties towards efficient encapsulation, entrapment of bioactive compounds, solubilization, targeted delivery, and bioavailability. Nanoemulsions are considered as one of the important vehicles for the sustained release of food bioactive compounds due to their smaller size (nm), increased surface area, and unique morphological characteristics. Nanoemulsification is an ideal technique for fabricating the bioactive compounds in a nano form. Formation and stabilization of nanoemulsion depends on the physi-cochemical characteristics of its constituents including oil phase, aqueous phase, and emulsifiers. This review is mainly focused on the instability mechanisms of nanoemulsion such as flocculation, Ostwald ripening, creaming, phase separation, coalescence, and sedimentation. Further, the major factors associated with these instability mechanisms like ionic strength, temperature, solubilization, particle size distribution, particle charge, pH strength, acid stability, and heat treatment are also discussed. Finally, safety issues of food grade nanoemulsions are highlighted.