A major research theme to emerge in the science and technology of materials is the incorporation of nanostructure. into the functionality of properties. Such nanostructured materials can offer distinct advantages over bulk materials, partly because the physical properties of the material itself can vary in a tunable, size-dependent fashion. Of course, in addition, nanoparticles offer a greatly increased surface area for chemical reaction. Typical methods for nanoparticle synthesis include: reaction in the liquid phase using the sot gel approach and mechanical ball-milling of the bulk material; both of these approaches are some. what problematic for the preparation of reactive nanostructured materials which are sensitive to air and/or Moisture. We report here the formation of crystalline nanoparticles of sodium hydride encapsulated in a host amorphous silica gel matrix. These nanoparticles are formed by in situ hydrogenation of a precursor material Na loaded silica gel-under mild conditions. The resulting material is considerably less pyrophoric and less air-sensitive than the bulk hydride. We anticipate that this formation method of in situ modification of reactive precursor material may have wide applications.