The kind of interactions which nanoparticles show in the biological systems is very interesting. Nanoparticles (NPs) on entering the living system immediately come in contact with proteins which serve many applications of nanoparticles including bio-signalling, therapeutics and drug delivery systems. Moreover, many inorganic oxide nanoparticles can also serve the purpose of antibacterial/antiviral by assisting in the production of reactive oxygen species (ROS). The role of nanoparticles in therapeutics is very significant and increasing day-by-day as it assures better treatment to the patient by enhancing activity of drug, improving bioavailability, flexibility in deciding route of administration and long term stability of drug resulting in better treatments of diseases. NPs such as solid lipid NPs, polymeric NPs, porous NPs, liposomes are being used for treatment of various types of diseases. Numerous carriers based drug delivery systems incorporating anti-TB drugs have been developed for target site actions. NPs encapsulating anti-cancer drugs such as doxorubicin, paclitaxel have also been developed for treatment of different types of cancers. Results of these studies give hopes to the researchers for the use of nanoparticles in the field of therapeutics. The NPs can be toxic as well as nontoxic to the biological system. Therefore, some adverse effects, such as, cytotoxicity on inhaling some kinds of nanoparticles must be kept in mind for judicious use of such systems during synthesis or during handling. The paper describes recent developments in the field by reviewing the available literature.