We encapsulated cyclosporine A (CsA) in poly(ethylene glycol)-b-poly(d,l-lactide-co-glycolide) (PEG-PLGA) nanoparticles (NPs) by nanoprecipitation of CsA and PEG-PLGA. The resulting CsA/PEG-PLGA-NPs were <100nm in diameter with a narrow particle size distribution. The NP size could be controlled by tuning the polymer concentration, solvent, or water/solvent ratio during formulation. The PEGylated NPs maintained non-aggregated in salt solution. Solid NPs lyoprotected with bovine serum albumin were prepared for the convenience of storage and transportation. The release kinetics of CsA (55.6% released on Day 1) showed potential for maintaining therapeutic CsA concentrations in vivo. In T-cell assays, both free CsA and CsA/PEG-PLGA-NPs suppressed T-cell proliferation and production of inflammatory cytokines dose dependently. In a mixed lymphocyte reaction assay, the IC(50) values for free CsA and CsA/PEG-PLGA-NPs were found to be 30 and 35ng/mL, respectively. This nanoparticulate CsA delivery technology constitutes a strong basis for future targeted delivery of immunosuppressive drugs with improved efficiency and potentially reduced toxicity.