Silver nanoparticles (Ag-NPs) stabilized by a polysaccharide, chitosan, (chitosan stabilized Ag-NPs), (C-Ag-NPs) have been synthesized by the reduction of silver ions with NaBH₄ in aqueous solutions. These Ag NPs were very stable at room temperature. The chitosan -stabilized Ag NPs were characterized by UV–vis spectroscopy and transmission electron microscopy. The antibacterial efficiency of the nanoparticles was investigated by introducing the particles into nutrient agar media containing E. coli, B. mycoides and B. subtilis. It was found that the Ag-NPs exhibited antibacterial effect even at very low concentrations. It was evident that silver nanoparticles displayed an excellent inhibitory effect on both gram positive as well as gram negative bacteria. Hence it might prove to be an effective antimicrobial agent to combat not only Bacterial Blight (BB), but also other bacterial diseases of rice.