Ultra-fine nanofiber mats of cellulosic polymer and polyvinyl alcohol (PVA) containing silver (Ag) nanoparticles were fabricated using the electrospinning technique. Polymers with hydroxyl groups on the backbone such as PVA, PVA/dextran and PVA/methyl cellulose were chosen for this study. All polymers showed the ability to reduce silver nitrate (AgNO3) to Ag-nanoparticles. To make crosslinkable networks of the water soluble polymers, the photo-crosslinkable glycidyl methacrylate moiety was attached to the hydroxyl groups of the designed macromers. AgNO3 and cytocompatible initiator (IRGACURE 2959) were added to the methacrylated polymeric solution mixture before electrospinning. The fiber morphology of the resultant nanofiber was characterised using scanning electron microscopy (SEM) and an average diameter in the range of 300 to 500 nm was observed. The resultant nanofibers containing Ag-ions and initiators were crosslinked under photoirradiation at a wavelength of 365 nm for 6 h and heated at 100 degrees C for 6 h for complete reduction of Ag-ions into Ag-nanoparticles. Transmission electron microscopy (TEM) analysis revealed that the Ag-nanoparticles with an average diameter of 10 to 20 nm were uniformly distributed throughout the nanofibers and its presence was confirmed using X-ray diffraction analysis. The effect of Ag-nanoparticles on the microcrystalline structure of the polymer was studied by thermal and mechanical properties analysis. The biocompatibility of the methacrylated macromers was investigated using human lung fibroblasts (IMR-90) and no cytotoxic effects were found after 4 days of incubation. The antimicrobial activity of the PVA nanofiber containing Ag-nanoparticles was tested against Escherichia coli. The nanofiber containing Ag-nanoparticles may have potential applications in biomedical devices which will be explored in the near future.