Water solubilization of nanoparticles is a fundamental prerequisite for many biological applications. To date, no single method has emerged as ideal, and several different approaches have been successfully utilized. These ‘phase-transfer’ strategies are reviewed, indicating key advantages and disadvantages, and a discussion of conjugation strategies is presented. Coating of hydrophobic nanoparticles with amphiphilic polymers provides a generic pathway for the phase transfer of semiconductor, magnetic, metallic, and upconverting nanoparticles from nonpolar to polar environments. Amphiphilic polymers that include maleimide groups can be readily functionalized with chemical groups for specific applications. In the second, experimental part, some of the new chemical features of such polymer-capped nanoparticles are demonstrated. In particular, nanoparticles to which a pH sensitive fluorophore has been attached are described, and their use for intracellular pH-sensing demonstrated. It is shown that the properties of analyte-sensitive fluorophores can be tuned by using interactions with the underlying nanoparticles.