The development of smart targeted nanoparticle that can deliver drugs to direct cancer cells, introduces better efficacy and lower toxicity for treatment. We report the development and characterizations of pH-sensitive carboxymethyl chitosan modified folic acid nanoparticles and manifest their feasibility as an effective targeted drug delivery vehicle. The nanoparticles have been synthesized from carboxymethyl chitosan with covalently bonded bifunctional 2,2'-(ethylenedioxy)-bis-(ethylamine) (EDBE) through the conjugation with folic acid. The conjugation has been analyzed by Fourier transform infrared spectroscopy and nuclear magnetic resonance spectroscopy. The resultant nanoparticles with an average size less then 200 nm measured by dynamic light scattering and transmission electron microscopy. Confocal microscopy and flow cytometric analysis have revealed that folate-mediated targeting significantly enhances the cellular uptake of the nanoparticle and thus facilitates apoptosis of cancer cells (HeLa, B16F1). For the application of the nanoparticles as a drug carrier, Doxorubicin a potent anticancer drug has been loaded into the nanoparticles, with the drug loading amount and the drug release pattern observed.