Development of parenteral nanoformulations is highly challenging due to the stringent demands on stability, reproducibility and high drug loading with minimal excipients. This study focuses on the development of a pharmaceutically acceptable nanomatrix system for parenteral delivery based on Hydroxyethyl Starch (HES), a FDA approved polymer that is relatively unexplored in drug delivery research. HES nanoparticles were prepared through a simple, two-step crosslinking-precipitation route, yielding 160±5 nm, nearly monodispersed spherical particles with high colloidal stability. The utility of this nanocarrier for parenteral delivery was verified by a panel of hemo/cytocompatibility assays at high concentrations (0.05-1 mg/ml) in vitro and in vivo. HES nanomatrix was found effective in encapsulating two chemically distinct drugs having varying hydrophobicities, with the release behavior being influenced by their chemical nature and drug-matrix interactions. Better in vitro efficacy was measured for the nanoencapsulated drug than its bare form, establishing the potential of HES nanocarriers for controlled drug delivery.