Biomineralization-inspired preparation of nanoparticles by marine microorganisms is in the limelight of modern nanotechnology. In recent years, the use of marine microorganisms for the synthesis of nanoparticles has been gaining importance due to the simplicity and eco-friendliness of the approach. Here we describe the synthesis of silver nanoparticles using halotolerant Bacillus sp. isolated from the southern coastal waters of India. Our selective and enriched isolation technique resulted in the isolation of a silver nitrate-resistant novel marine Bacillus sp. isolated from sediments collected at Ennore Port, Chennai, India. The strain was characterized by the polyphasic taxonomic approach, and phenotypic and phylogenetic analysis identified the strain as Bacillus sp. VITSSN01. The resistant strain was further assayed for the synthesis of silver nanoparticles and its biological activity evaluated. Nanoparticles were synthesized under optimized nutritional and cultural conditions with shaking and the production continuously monitored. The nanoparticles thus produced were then characterized by atomic force microscopy, X-ray diffraction, Fourier transform-infrared spectrophotometer and transmission electron microscopy. The mean particle size was 46 nm. Hemotological toxicity of nanoparticles is very severe form and less studied. We therefore checked the synthesized silver nanoparticles for toxicity against erythrocytes and found that the silver nanoparticles exhibited moderate hemolytic activity against human erythrocytes, with a half maximal effective concentration (EC 50) value of 60 μg/ml. Microscopic studies of the treated erythrocytes showed slight structural perturbations. The results of our study strongly suggest that marine microorganisms could be a potential source for the rapid and eco-friendly synthesis of nanoparticles. © 2013 Springer-Verlag Berlin Heidelberg and the University of Milan.