The synthesis of fluorescent nanocrystals is receiving a lot of attention for potential application in biological labeling as well as phosphors for field emission devices. Zinc sulphide doped with manganese (ZnS:Mn2+) is one of the most efficient electroluminescent phosphor displaying a wide emission band centred around 590 nm resulting from the intra-ionic transition in Mn2+ ions. We report a unique synthesis of zinc sulphide nanoparticles doped with manganese using a biocompatible passivating agent ‘chitosan’, with bright luminescence peaking at 590 nm. This high luminescence efficiency of the synthesized nanocrystals are ideal for quantum dot based bio-labeling applications. Synthesis of the nanoparticles was carried out by precipitation reaction in aqueous media of zinc acetate and sodium sulphide where manganese acetate was added as the dopant. The obtained nanoparticles were around 4 to 6 nm in size and were found to be stable for months of shelf life. The photoluminescence intensity did not degrade when the colloid was heated up to 65 oC for prolonged periods.