We describe the synthesis of water-soluble semiconductor nanoparticles and discuss and characterize their proper-ties. Hydrophobic CdSe/ZnS core/shell nanocrystals with a core size between 2 and 5 nm are embedded in a siloxane shell and functionalized with thiol and/or amine groups. Structural characterization by AFM indicates that the siloxane shell is 1-5 nm thick, yielding final particle sizes of 6-17 nm, depending on the initial CdSe core size. The silica coating does not significantly modify the optical properties of the nanocrystals. Their fluorescence emission is about 32-35 nm fwhm and can be tuned from blue to red with quantum yields up to 18%, mainly determined by the quantum yield of the underlying CdSe/ZnS nanocrystals. Silanized nanocrystals exhibit enhanced photochemical stability over organic fluorophores. They also display high stability in buffers at physiological conditions (> 150 mM NaCl). The introduction of functionalized groups onto the siloxane surface would permit the conjugation of the nanocrystals to biological entities.