To improve the efficiency of topical ocular drug administration, we focused on development of a nanoparticles loaded contact lens to deliver the hydrophobic drug over a prolonged period of time. The cross-linked nanoparticles based on PCL (poly epsilon-caprolactone), 2-hydroxy ethyl methacrylate (HEMA), and poly ethylene glycol diacrylate (PEG-DA) were prepared by surfactant-free miniemulsion polymerization. The lens material was prepared through photopolymerization of HEMA and N-vinylpyrrolidone (NVP) using PEG-DA as the cross-linker. Effects of nano particles loading on critical contact lens properties such as transparency, water content, modulus and ion and oxygen permeabilities were studied. Nanoparticles and hydrogel showed high viability, indicating the absence of cytotoxicity and stimulatory effect. Drug release studies revealed that the hydrogel embedded with nanoparticles released the drug for a period of 12 days. The results of this study provide evidence that nanoparticles loaded hydrogels could be used for extended delivery of loteprednol etabonate and perhaps other drugs.