Silver nanoparticles (Ag NPs) have recently received much attention for their possible applications in biotechnology and life sciences. Ag NPs are of interest to defense and engineering programs for new material applications as well as for commercial purposes as an antimicrobial. However, little is known about the genotoxicity of Ag NPs following exposure to mammalian cells. This study was undertaken to examine the DNA damage response to polysaccharide surface functionalized (coated) and non-functionalized (uncoated) Ag NPs in two types of mammalian cells; mouse embryonic stem (mES) cells and mouse embryonic fibroblasts (MEF). Both types of Ag NPs up-regulated the cell cycle checkpoint protein p53 and DNA damage repair proteins Rad51 and phosphorylated-H2AX expression. Furthermore both of them induced cell death as measured by the annexin V protein expression and MTT assay. Our observations also suggested that the different surface chemistry of Ag NPs induce different DNA damage response: coated Ag NPs exhibited more severe damage than uncoated Ag NPs. The results suggest that polysaccharide coated particles are more individually distributed while agglomeration of the uncoated particles limits the surface area availability and access to membrane bound organelles.