The cyclosporine-loaded poly(lactide-co-glycolide) (PLGA) nanoparticles (NPs) were prepared by the emulsion-diffusion-evaporation method and were optimized for particle size and entrapment efficiency. The optimized particles were 143.3+/-8.7 nm in size with narrow size distribution and 71.9+/-1.7% entrapment efficiency at 20% w/w initial drug loading when prepared with 0.1% w/v of Didodecylmethylammonium bromide (DMAB) as stabilizer. These particulate carriers exhibited controlled in vitro release of cyclosporine for 23 days at a nearly constant rate and showed very good hemocompatibility in vitro. The nanoparticulate formulation showed significantly higher intestinal uptake as compared to Sandimmune Neoral and cyclosporine suspension. The relative bioavailability of nanoparticulate formulation was found to be 119.2% as compared to Sandimmune Neoral. A marked difference in the pharmacokinetic profile between nanoparticulate and Sandimmune Neoral formulations was observed where nanoparticulate formulation showed controlled release of cyclosporine over 5 days, on the other hand, the marketed formulation showed a sharp Cmax with a 3-day release profile. The nanoparticulate formulation exerted significantly lower nephrotoxicity in the rats as compared to Sandimmune Neoral, which was evidenced by lower blood urea nitrogen (BUN), plasma creatinine (PC) and malondialdehyde (MDA) levels in plasma and kidney. The results were further supported by the histopathological changes in kidneys. Together, these results indicate that PLGA NPs have greater potential for oral delivery of cyclosporine.