A simple, inexpensive, single-step synthesis of gold and silver nanciparticles using poly(allylamine) (PAAm) as a reducing and stabilizing agent is reported. The synthetic process was carried out in aqueous solution, making the method versatile and environmentally friendly. The synthesized polymer-stabilized nanoparticles are stable in water without particle aggregation at room temperature for at least a month. We demonstrate successful ligand exchange on the polymer-stabilized gold nanciparticles (AuNPs) with a variety of omega-functionalized acid-, alcohol-, amine-, and biotin-terminated alkylthiols. The methodologies, including ligand exchange, also are applicable for the generation of finely dispersed silver nanciparticles. The synthesized gold and silver nanoparticles are characterized by UV-visible absorption spectroscopy and transmission electron microscopy (TEM). The different ligand-stabilized AuNPs are also analyzed by Fourier transform infrared (FTIR) spectroscopy.