The fast growing research in the field of nanotechnology in the last decade is a challenge as well as an opportunity for Indonesia to participate in the world market. This paper aimed to assess the prospects of nanotechnology application in Indonesia, especially in agriculture and food processing. The study was conducted through a literature review. Nanotechnology has a promising prospect to be applied in Indonesia. However, the research, development, and application of nanotechnology in Indonesia grow slowly and are more focused on areas other than agriculture and food processing, such as electronics, energy, medicine, pharmacy, etc. Barriers to the development of nanotechnology in Indonesia among others are (1) inadequate nanotechnology facilities and dispersed sporadically in a number of institutions, (2) lack of synergism among research institutions working on nanotechnology, (3) less supporting human resources, and (4) limited budget. A number of studies reveal that nanotechnology application in agriculture and food processing in Indonesia includes fertilizers, antioxidants, preservatives, fortification, functional foods, nutraceuticals, smart packaging, etc. In order to support nanotechnology application in national agro-industry, some policies to implement are (a) developing nanotechnology research network at national level, (b) socialization of nanotechnology and its potential utilization in agriculture, (c) strengthening human resource capacity in nanotechnology, (d) developing nanotechnology research synergy, (e) developing the governance of nanotechnology research at IAARD, (f) setting research priorities of nanotechnology, and (g) developing collaboration with private parties.