Nanoparticles are of great importance in development and research because of their application in industries and biomedicine. The development of nanoparticles requires proper knowledge of their fabrication, interaction, release, distribution, target, compatibility, and functions. This review presents a comprehensive update on nanoparticles’ toxic effects, the factors underlying their toxicity, and the mechanisms by which toxicity is induced. Recent studies have found that nanoparticles may cause serious health effects when exposed to the body through ingestion, inhalation, and skin contact without caution. The extent to which toxicity is induced depends on some properties, including the nature and size of the nanoparticle, the surface area, shape, aspect ratio, surface coating, crystallinity, dissolution, and agglomeration. In all, the general mechanisms by which it causes toxicity lie on its capability to initiate the formation of reactive species, cytotoxicity, genotoxicity, and neurotoxicity, among others.