We report a facile and efficient approach for synthesis of well-dispersed and stable silver nanoparticles (Ag NPs) using water-soluble cellulose acetate (CA) as both reductant and stabilizer. Partially substituted CA with highly active hydroxyl groups and excellent water-solubility is able to reduce silver ions in homogeneous aqueous medium effectively. The synthesized Ag NPs were characterized by UVvis spectroscopy, X-ray diffraction, X-ray photoelectron spectroscopy, transmission electron microscopy and energy dispersive X-ray spectroscope analysis. The as-prepared Ag NPs were well-dispersed, showing a surface plasmon resonance peak at 426nm. The resulted Ag NPs@CA nanohybrids exhibit high catalytic activity for the reduction of 4-nitrophenol to 4-aminophenol in the presence of NaBH4. Meanwhile, the nanohybrids are also effective in inhibiting the growth of bacterial. This environmentally friendly method promotes the use of renewable natural resources to prepare a variety of inorganic-organic materials for catalysis, antibacterial, sensors and other applications.