Nanocomposite from the natural source is opened a wide area for the researchers to find a natural remedy to replace the chemicals or harmful products in all the fields of agricultural, food and medical fields. Here the biopolymer (chitosan) was extracted from the two white rot fungi of Pleurotus floridanus and Pleurotus djamor, and biologically synthesized with 1mM AgNO3 solution. Synthesized chitosan nanocomposite was characterized with UV-Visible study, FTIR, FESEM, XRD, EDAS for the confirmation based upon the peaks, functional group, crystalline nature, size, morphology and the percentage of elements respectively. Toxicity study was carried out using 3T3 L1 (Mouse embryo fibroblast Cell Line) normal Cell Line to find out the cytotoxicity effect of the chitosan nanocomposite and found that the nanocomposites were non toxic to the Cell Line.