Nanotechnology is an interdisciplinary science that involves the production, manipulation and use of materials with nano-scale. Nanobiotechnology has emerged as an important branch of nanotechnology. The combination of biological principles with physical and chemical processes generates specific nano-sized structures. Nanobiotechnology applies the capabilities of biological systems in generating a variety of nano-sized structures. Plants, algae, bacteria and fungi are examples of such systems. Nanobiotechnology has played an important role in providing eco-friendly alternative routes for synthesizing nanoparticles. Yarrowia lipolytica is a non-pathogenic yeast and generally regarded as safe with various biotechnological applications. The green synthesis of silver nanoparticles by Y. lipolytica DSM 3286 was investigated in this study. Microscopic observations, scanning electron microscopy (SEM) and spectroscopy analysis revealed the presence of silver nanoparticles. The nanoparticles exhibited a specific peak at 410 nm and the presence of silver elements were confirmed by energy dispersive X ray (EDX). Scanning electron microscopy (SEM) and transmission electron microscopy (TEM) micrographs showed both intra- and extra-cellular synthesis of silver nanoparticles.