Nanotechnology has seen exponential growth in last decade due to its unique physicochemical properties; however, the risk associated with this emerging technology has withdrawn ample attention in the past decade. Nanotoxicity is majorly contributed to the small size and large surface area of nanomaterials, which allow easy dispersion and invasion of anatomical barriers in human body. Unique physio-chemical properties of nanoparticles make the investigation of their toxic consequences intricate and challenging. This makes it important to have an in-depth knowledge of different mechanisms involved in nanomaterials's action and toxicity. Nano-toxicity has various effects on human health and diseases as they can easily enter into the humans via different routes, mainly respiratory, dermal, and gastrointestinal routes. This also limits the use of nanomaterials as therapeutic and diagnostic tools. This review focuses on the nanomaterial-cell interactions leading to toxicological responses. Different mechanisms involved in nanoparticle-mediated toxicity with the main focus on oxidative stress, genotoxic, and carcinogenic potential has also been discussed. Different methods and techniques used for the characterization of nanomaterials in food and other biological matrices have also been discussed in detail. Nano-toxicity on different organs-with the major focus on the cardiac and respiratory system-have been discussed. Conclusively, the risk management of nanotoxicity is also summarized. This review provides a better understanding of the current scenario of the nanotoxicology, disease progression due to nanomaterials, and their use in the food industry and medical therapeutics. Briefly, the required rules, regulations, and the need of policy makers has been discussed critically.