Cytosine deaminase is a non-mammalian enzyme of widespread interest for prodrug enzyme therapy due to its ability to convert prodrug 5-fluorocytosine into anticancer drug 5-fluorouracil. Cytosine deaminase enzyme has been purified to homogeneity from E. coli K-12 MTCC 1302 strain. Km values for cytosine and 5-fluorocytosine were found to be 0.26 mM and 1.82 mM, respectively. We developed a chitosan-entrapped cytosine deaminase nanocomposite. Atomic force microscopy and transmission electron microscopy images showed an elongated sphere shape nanocomposite with an average size of 80 nm diameter. Fourier transform infrared spectroscopy and X-ray diffraction results confirmed gel formation and entrapment of cytosine deaminase within the nanocomposite. Sustained release of cytosine deaminase from the nanocomposite up to one week depicted its potential implication in prodrug inducted enzyme therapy.