The formidable antifungal agent, Amphotericin B, is well-known for its potency; however, its clinical application has been significantly limited due to toxicity and poor solubility. This study aims to address these challenges by developing and evaluating a novel nano-cellulose-based formulation of Amphotericin B to enhance its efficacy. Amphotericin B was encapsulated within cellulose nanofibers at varying ratios to optimize formulation parameters, including drug concentration, particle size, zeta potential, and entrapment efficiency. Notably, a composition ratio of 10:1 of cellulose nanofibers to Amphotericin B achieved an impressive encapsulation efficiency of 96.64 %. Subsequent physicochemical characterizations employing techniques such as FTIR, DLS, XRD, and SEM provided insights into structural attributes and interactions within formulation. Controlled and extended-release profiles were observed at various physiological pH levels, with the Korsmeyer-Peppas model showing the highest correlation, indicating predominant drug diffusion. Importantly, nanoformulation demonstrated non-toxicity to A431 cells and human erythrocytes up to a maximum concentration of 20 μg/ml, as corroborated by MTT and hemolysis assays. Furthermore, antimicrobial susceptibility and efficacy assessments, conducted using agar diffusion and broth micro-dilution methods, revealed enhanced inhibition of Candida albicans growth. The nanoformulation produced a larger zone of inhibition (DIZ) of 19.66 mm compared to a DIZ of 16.33 mm for Amphotericin B alone. Impressively, the nanoformulation exhibited a minimum inhibitory concentration (MIC) of 25 μg/ml against Candida albicans, underscoring its heightened efficacy. Additionally, the formulation's ability to improve the targetability and bioavailability of Amphotericin B holds promise for enhancing its antifungal effectiveness while reducing associated toxicity.