Drug delivery to ocular region is a challenging task. Only 1-2% of drug is available in eye for therapeutic action, rest of the drug is drained out through nasolachrymal drainage system and other ocular physiological barriers. To overcome these problems of conventional dosage form, novel drug delivery systems are explored like nanoparticles. In our present work, levofloxacin encapsulated poly(lactic-co-glycolic acid) nanoparticles were developed and evaluated for various parameters like particle size, ζ potential, in vitro drug release and ex vivo transcorneal permeation. Microbiological efficacy was tested against Staphylococcus aureus using cup-plate method. Precorneal residence time was studied on albino rabbits by γ scintigraphy after radiolabeling of levofloxacin by Tc-99m. Ocular tolerance was evaluated using hen's egg chorioallantoic membrane (HET-CAM) test. The developed nanoparticles were of spherical shape with a mean particle size of 190-195 nm with a ζ potential of -25 mV. The drug entrapment efficiency was found to be near 85%. In vitro drug release profile shows initial burst release followed by extended release up to 24 h. Microbiological assay showed equivalent zone of inhibition compared to marketed formulation. γ Scintigraphy images of developed formulation, suggested a good spread and good retention over precorneal area. The nanosuspension thus developed was retained for the longer time and drained out from the eye very slowly compared to marketed formulation as significant radioactivity was recorded in later in kidney and bladder. The developed nanosuspension with a mean score of 0.33 up to 24 h in HET-CAM assay, showed the nonirritant efficacy of developed formulation. The stability studies yielded a degradation constant less then 5 × 10(-4), proving a stable formulation with an arbitrary shelf life of 2 years.