Two bacterial strains VIT RSAS1 and VIT RSAS2 obtained from the poultry farms in Vellore were investigated for the keratinase enzyme production. The maximum amount of keratinase activity of strain RSAS2 (about 104 Uml-1) was produced at 37°C when the bacterium was cultured for 432 Hrs. in broth containing feathers with initial pH of 7. The keratinase activity was observed over a wide range of pH values (pH 3 - 9) and varying substrate concentration. It was optimal at pH 7 - 8 and 0.5 mg substrate /μl enzyme respectively. The synthesis of nanoparticles was also monitored. Silver nanoparticles were synthesised using the keratinase enzyme produced by the bacterial strain. Production of silver nanoparticles was monitored by UV- visible spectroscopic analysis. The peak was observed between 400-450 nm indicating their presence. Additionally the antibacterial activity of nanoparticles was checked against E.coli and Staphylococcus aureus which can be used for various research and pharmacological studies.