Rod shaped gold nanoparticles are synthesized using cetyltriammonium bromide (CTAB) as a major component of growth solutions. This surfactant is toxic to cells, but is at the moment unavoidable when monodisperse and high yield nanorods are to be synthesized. CTAB is found coating side walls of the nanoparticles and plays a role in maintaining colloidal stability. It may be displaced using thiolated PEG which is non-toxic to cells. Here we report on systematic studies of cell viability of such PEGylated nanorods on an SKBR3 cell-line using the MTS assay. These PEGylated particles are characterized using electron microscopy, optical spectroscopy and zeta potential measurements. It is expected that such treatment will be crucial in making nanorods compatible for in vivo biomedical applications.© (2009) COPYRIGHT SPIE--The International Society for Optical Engineering. Downloading of the abstract is permitted for personal use only.