An inorganic/organic composite hybrid nano-system has been successfully synthesized in which nanocrystalline quantum dots (QDs) were effectively immobilized within a photo-cross-linked poly(ethylene glycol) (PEG) hydrogel. The immobilization of 3.5-6.0 nm CdTe and 2.0-3.5 nm CdSe QDs within the PEG hydrogel network has been shown to be effective through utilization of physical trapping. These QD-immobilized gel systems demonstrated luminescence characteristics unique to semiconductor QD nanocrystals. Controlled particle extraction from the PEG hydrogel matrix may be possible via a photocleavage process. The solubility property of QDs was controlled through surface functionalization. It is envisioned that the unique photophysical properties of this new material can be utilized as a convenient signal transducer for chemo-/bio-sensing. A promising application of the described QD/PEG-NC hybrid system may be in the fields of fluoroimmunoassay and as a monitoring system for drug delivery and wound healing.