Effect of using Al2O3-water nanofluids with different volume fractions and particle diameters on generated entropy, hydrodynamic performance and heat transfer characteristics of a tangential micro-heat sink (TMHS) was numerically investigated in this research. Results indicated that considerable heat transfer enhancement is possible when using Al2O3-water nanofluids as coolant and clearly the enhancement improves with increasing particles concentration and decreasing particles size. However, using nanofluid has also induced drastic effects on the pumping power that increases with particles volume fraction and Reynolds number. Finally, it was found that generated total entropy decreases with increasing volume fraction and Reynolds number and decreasing particles size. (C) 2012 Elsevier Ltd. All rights reserved.