Astaxanthin, a hydrophobic carotenoid found in marine plants and animals, is claimed to exhibit various beneficial biological activities. Its use as a nutraceutical in foods, however, is currently limited by its low water-solubility and poor bioavailability. The goal of this paper was to fabricate astaxanthin-loaded colloidal particles to overcome these challenges. Astaxanthin was encapsulated in poly(lactic- co-glycolic acid) (PLGA) nanoparticles coated with chitosan oligosaccharides (COS). The properties of the loaded nanoparticles were characterized by transmission electron microscopy, scanning electron microscopy, and dynamic light scattering. The influence of PLGA properties on the loading capacity, water solubility, stability, and release of the astaxanthin were determined. The nanoparticles were smooth spheres with mean particle diameters around 150 nm and positive surface potentials (ζ = +30 mV). The encapsulation efficiency (>85%) and loading capacity (>15%) of the astaxanthin in the nanoparticles was relatively high. X-ray analysis suggested that the encapsulated astaxanthin was in an amorphous form. The nanoparticles had good dispersibility and stability in aqueous solutions, as well as high cytocompatibility. In vitro studies showed that the astaxanthin was released from the nanoparticles under simulated gastric and small intestinal conditions. Overall, our results suggest the core-shell nanoparticles developed in this study may be suitable for encapsulating this important nutraceutical in functional foods and cosmetics.