Chitosan (CS) is a natural nontoxic biopolymer derived by the removal of an acetyl group (deacetylation) from chitin taken from the prawn shell. Chitosan nanoparticles (CNPs) are used as a drug carrier. It improves drug solubility, stability, enhances efficacy and reduces toxicity by releasing drug slowly. The present study was carried out to synthesis CS from prawn shell and preparing drug-loaded CNPs using polyherbal formulation (Andrographis paniculata, Andrographis alata, Adhatoda zeylanica, Gymnema sylvestre, Syzygium cumini, and Justicia glabra) and evaluated its antidiabetic efficiency. CNPs were synthesized by ionic gelation method. CS and drug-loaded CNPs were characterized by XRD pattern, Fourier transform infrared spectroscopy (FTIR) analysis, and SEM studies. Prepared CNPs showed spherical in shape, nano range particle size. The size of drug-loaded CNPs ranged from 37.6 nm to 39.5 nm. Nanoparticles (NPs) were found to be crystalline in nature confirmed by x-ray diffraction (XRD). The prepared drug-loaded CNPs exhibited 85% drug encapsulation efficiency. The present results suggested that drug-loaded CNPs could be used as an ideal carrier to deliver the antidiabetic drug to the specific target.