Over the last decade, nanoparticles have found great interest among scientists and researchers working in various fields within the realm of biomedicine including drug delivery, gene delivery, diagnostics, targeted therapy and biomarker mapping. While their physical and chemical properties are impressive, there is growing concern about the toxicological potential of nanoparticles and possible adverse health effects as enhanced exposure of biological systems to nanoparticles may result in toxic effects leading to serious contraindications. Toxicity associated with nanoparticles (nanotoxicity) may include the undesired response of several physiological mechanisms including the distressing of cells by external and internal interaction with nanoparticles. However, comprehensive knowledge of nanotoxicity mechanisms and mitigation strategies may be useful to overcome the hazardous situation while treating diseases with therapeutic nanoparticles. With the same objectives, this review discusses various mechanisms of nanotoxicity and provides an overview of the current state of knowledge on the impact of nanotoxicity on biological control systems and organs including liver, brain, kidneys and lungs. An attempt also been made to present various approaches of scientific research and strategies that could be useful to overcome the effect of nanotoxicity during the development of nanoparticle-based systems including coating, doping, grafting, ligation and addition of antioxidants.