Functionalization of nanoscale (<100 nm) particles at the cellular level is highly specific and can be employed to develop efficient diagnostic and therapeutic procedures with the minimum of side effects. The binding of nanosized particles (quantum dots, iron oxide nanocrystals, nanowires, and nanotubes) with ligands creates varied optical, magnetic, or structural properties through a multivalency effect. These properties determine the affinity and specificity of nanoparticles. Several nanoparticles have been used in biomedicine such as gold, iron oxide, silver, carbon nanotubes, graphene, zinc oxide, alumina, silica, and titanium. Metallic nanoparticles (silver, gold, and silver–gold alloy nanoparticles) with their unique properties play a significant role in the prevention of blood clot formation, dissolution of blood clots, and enhanced imaging of thrombus (blood clot) in vivo. Blood is the biological fluid that delivers nanoparticles to targeted sites. Nanoparticles come in direct contact with all components of the blood, that is, erythrocytes, platelets, and leukocytes. They induce phosphatidylserine on erythrocyte membranes which alter the hemorheological mechanisms. The shape and size of RBCs are particularly important for the efficient transport of oxygen. Furthermore, deformed RBCs can be detected by the elasticity of red blood cells. In this chapter, the focus is on various applications of nanotechnology in biological systems and medicine.