Chitosan is an abundant natural cationic polysaccharide with excellent biodegradability, bioadhesion, and biocompatibility. Chitosan is extensively researched for various particulate oral insulin drug delivery systems. Oral insulin is economically efficient and more convenient than injections, with greater patient compliance. Electrostatic ionic interaction between cationic chitosan and anionic polymer or insulin leads to the formation of spontaneously self-assembled nanoparticles. This simple technique attracted many researchers as it can be carried out quickly in mild conditions without harmful solvents, such as surfactants or chemical cross-linkers that might degrade the insulin structure. The formulated chitosan nanoparticles help to protect the core insulin from enzymatic degradation in the digestive system and improve paracellular intestinal uptake from the enterocytes due to mucoadhesion and reversible tight junction opening. Moreover, functionalized chitosan nanoparticles create newer avenues for targeted and prolonged delivery. This review focuses on modified chitosan-insulin nanoparticles and their implications on oral insulin delivery. Dependent variables and their optimal concentration ranges used in self-assembly techniques for chitosan-insulin nanoparticular synthesis are summarized. This review provides a comprehensive guide to fine-tune the essential factors to formulate stable insulin-chitosan nanoparticles using mild ionic interactions.