Nanoparticles hold tremendous potential as an effective drug delivery system. In this overview we discussed recent developments in nanotechnology for drug delivery. To overcome the problems of gene and drug delivery, nanotechnology has gained interest in recent years. Nanosystems with different compositions and biological properties have been extensively investigated for drug and gene delivery applications. To achieve efficient drug delivery it is important to understand the interactions of nanomaterials with the biological environment, targeting cell-surface receptors, drug release, multiple drug administration, stability of therapeutic agents and molecular mechanisms of cell signaling involved in pathobiology of the disease under consideration. Several anti-cancer drugs including paclitaxel, doxorubicin, 5-fluorouracil and dexamethasone have been successfully formulated using nanomaterials. Quantom dots, chitosan, Polylactic/glycolic acid (PLGA) and PLGA based nanoparticles have also been used for in vitro RNAi delivery. The use of nanomaterials including peptide-based nanotubes is a new approach to control disease progression.