The synthesis of poly(ethylene glycol)-b-poly(2-N,N-dimethylaminoethylmethacrylate) processing an acetal group at the PEG chain end (acetal-PEG/PAMA) is reported. The obtained acetal-PEG/PAMA block copolymer was found to reduce tetrachloroauric acid at room temperature to produce gold nanoparticles. The size of these nanoparticles was controllable in the range of 6 to 13 nm by changing the initial Au3+: polymer ratio. In addition to the reduction of tetrachloroauric acid, acetal-PEG/PAMA bonds on the surface of the obtained gold nanoparticles to improve their dispersion stability in an aqueous medium even at a salt concentration as high as two. Biotinyl-PEG/PAMA-anchored gold nanoparticles undergo specific aggregation in the presence of streptavidin thereby revealing their promising utility as colloidal sensing systems for use in biological systems. Biotin-PEG/PAMA can also be utilised for the preparation of a functionally PEGylated quantum dot (QD). When CdCl2 and Na2S were mixed in aqueous media in the presence of the biotin-PEG/PAMA, a CdS QD with an ∼5 nm size was prepared. The polyamine segment was anchored onto the surface of the formed CdS nanoparticle, whereas the PEG segment was tethered onto the surface to form a hydrophilic palisade, thus improving the dispersion stability in aqueous media even under a high salt concentration condition. An effective fluorescent resonance energy transfer (FRET) was observed by the specific interaction of the biotin-PEG/PAMA stabilised CdS QD with TexasRed-labelled streptavidin with the physiological ionic strength of 0.15 M. The extent of the energy transfer was in proportion to the concentration of the TexasRed-streptavidin. This FRET system using the PEGylated CdS QD coupled with fluorescent-labelled protein can be utilised as a highly sensitive bioanalytical system.