The present article reports the synthesis of silver nanoparticles in silica aerogel matrix by sub-critical drying technique. The catalytic performance of these nanocomposites was evaluated for the selective oxidation of benzene. Silica aerogel with 1, 5, 10 and 25 wt.% of silver was prepared and characterized for their physico-chemical characteristics. The catalytic performance of these samples was evaluated as a function of silver particle size crystallized within the aerogel matrix. The sample with the silver concentration of 1 wt.% showed high selectivity among the tested samples. With increasing silver particle size, the % conversion increased with a decreased selectivity, which is attributed to the particle size effect on the catalytic oxidation of benzene.