Gold nanocrystals modified with peptide nucleic acids (PNAs) have been prepared and applied to self-assembly and DNA sensing. Experiments with different PNA structural motifs show that (1) the versatility in PNA synthetic design can be used to modulate the electrostatic surface properties of nanocrystals, presenting an opportunity to control assembly rate and aggregate size, (2) short (6 base) PNAs can hybridize effectively while attached to nanoparticles, providing a route to generating materials with small interparticle spacings, and (3) the superior base pair mismatch selectivity of PNAs is further enhanced on nanosurfaces, enabling PNA-modified nanoparticles to act as highly selective nanoscale sensors, as well as synthons for defect-free self-assembly. This last feature was coupled with a substantial change in colloidal stability upon DNA hybridization to develop a novel colorimetric DNA assay that detects the presence of single base imperfections within minutes. Various modes of PNA hybridization, including the first practical application of PNA-PNA interactions, were used to direct the assembly of nanoparticles into macroscopic arrangements. Shorter duplex interconnects and greater specificity in assembly were obtained compared to similar experiments with DNA-modified nanocrystals.