Glutathione-mediated biotransformation in the liver is a key and well-known detoxification process for the body to eliminate small xenobiotics but its impacts on nanoparticle retention, targeting and clearance are much less understood than liver macrophage uptake even though both processes are involved in the liver detoxification function. This dissertation aims to fundamentally understand how glutathione-mediated biotransformation in the liver impacts the in vivo transport of nanoparticles at the chemical level and how this unique physiological process could be exploited to enhance the disease targeting and/or minimize potential toxicity of nanomedicines. In Chapter 1, the current status on understanding of nanoparticle clearance in vivo through the kidneys and liver was reviewed and glutathione-mediated biotransformation as a key hepatic detoxification function was also discussed. In Chapter 2, the kidney transport and elimination of glutathione-protected Au25 nanoclusters (GS-Au25) in vivo were noninvasively imaged by photoacoustic tomography at high temporal and spatial resolution, which for the first time enabled the accurate quantification of single kidney glomerular filtration rate (GFR) by an engineered nanoparticle. Combining other evidences suggests that GS-Au25 was eliminated in vivo through free glomerular filtration and could serve as an excellent exogenous glomerular filtration marker. In Chapter 3, the mechanism of hepatic glutathione-mediated biotransformation of the model nanoparticle, ICG4-GS-Au25, was unraveled at the chemical level. It was found that glutathione efflux from hepatocytes resulted in high local concentrations of not only glutathione but also cysteine in liver sinusoids, which transformed the surface chemistry of nanoparticles, reduced their affinity to serum proteins and significantly altered their blood retention, targeting and clearance. In Chapter 4, the fundamental discovery of hepatic glutathione-mediated biotransformation of nanoparticles was extended to other nanosystems with distinct sizes and surface chemistries. The biotransformation rate of solid gold nanoparticles was found to exponentially decrease with the increase in their core sizes, which is likely due to more reactive surface gold atoms on the smaller gold nanoparticles. This liver glutathione-mediated biotransformation function was exploited to enhance the targeting of small-molecule prodrugs as well as reduce the nonspecific accumulation of large thiol-degradable nanoparticles in the body. In Chapter 5, future work and outlook were discussed.