Polyhydroxyalkanoates (PHAs) are storage granules found in bacteria that are essentially hydroxy fatty acid polyesters. PHA molecules appear in variety of structures, and amongst all types of PHAs, polyhydroxybutyrate (PHB) is used in versatile fields as it is a biodegradable, biocompatible, and ecologically safe thermoplastic. The unique physicochemical characteristics of these PHAs have made them applicable in nanotechnology, tissue engineering, and other biomedical applications. In this review, the optimization, extraction, and characterization of PHAs are described. Their production and application in nanotechnology are also portrayed in this review, and the precise and various production methods of PHA-based nanoparticles, such as emulsion solvent diffusion, nanoprecipitation, and dialysis are discussed. The characterization techniques such as UV-Vis, FTIR, SEM, Zeta Potential, and XRD are also elaborated.