Synthesis of silver nanoparticles using fungi is emerging as an important branch of nanotechnology due to its ecofriendly, safe, and cost-effective nature. The present work investigates the synthesis of silver nanoparticles by biological method using fungus Fusarium oxysporum. The test fungus was isolated from decayed banana fruit in PDA. Based on identification using morphological characteristics, Fusarium oxysporum was identified. The production of silver nanoparticles by the fungus Fusarium oxysporum was investigated. It was found that exposure of Fusarium oxysporum to silver ion leads to the formation of silver nanoparticles. Synthesized nanoparticles were characterized by UV-Vis spectroscopy and the peak of the spectra was found to be at 420nm. The morphological study of Silver nanoparticles using TEM suggests that the nanoparticles are spherical in shape with a diameter around 50-100nm. The TEM characterization of the fungus reacted on the silver ion indicated that the protein might be responsible for the stabilization of the silver nanoparticles. The rapid synthesis of silver nanoparticles would be suitable for developing a “microbial nanotechnology” biosynthesis process for mass scale production.