A novel "green" route to prepare CdS nanoparticles under ambient conditions is reported. The long-term studies were carried out with immobilized fungus Coriolus versicolor in continuous column mode. The immobilized fungus served a dual purpose of both bioremediating cadmium as well as synthesizing stable CdS nanoparticles in aqueous conditions. The fungus immobilized in the column could remove 98% cadmium within 2 h. The continuous and extracelluar production of autocapped CdS nanoparticles is an added advantage of this system. Interestingly, no external source of sulfur is required for the transformation of toxic Cd to non-toxic CdS. The thiol group of the fungal protein was found mainly responsible for the production of such highly stable and autocapped CdS nanoparticles. The physico-chemical properties of the particles were studied by FTIR, XRD, SEM, TEM, AFM, TGA and PL. (C) 2009 Elsevier B.V. All rights reserved.