All-trans retinoic acid (atRA) is used in the differentiation therapy of Acute Promyelocytic Leukemia. However, its therapeutic success is limited by the appearance of relapse and recalcitrant cases, poor aqueous solubility and high degradability. In the current work, we prepared two types of atRA-loaded copolymer nanoparticles – PL1RA and PC1RA, based on poly(ethyleneglycol) (PEG)-poly(l-lactide) and PEG-poly(ε-caprolactone), respectively. We then evaluated their physico-chemical properties and compared their differentiation-inducing potential of HL-60 cells with free atRA. These nanoparticles were in the size range 100–150 nm, possessed moderate colloidal stability and exhibited around 30% encapsulation efficiencies. In vitro release studies indicated pseudo-zero order release of a sustained nature, with PL1RA showing 71% and PC1RA exhibiting 84% drug release over a period of two weeks. Photostability measurements exhibited considerable increase in atRA photostability in the nanoparticle forms: 25% of the drug in PL1RA and 19% in PC1RA was intact as compared to only 5% for free atRA after 8 h of light exposure. PL1RA and PC1RA exhibited efficacies comparable to free atRA in inducing HL-60 respiratory burst as assessed by nitroblue tetrazolium and 2′,7′-dichlorodihydro fluorescein diacteate assays. The average CD11b expressions for atRA, PL1RA and PC1RA on day 5 of treatment were 58%, 49% and 60%, respectively. Post-differentiation apoptosis (∼40%) and reduction in mitochondrial transmembrane potentials (∼60–70%) were also comparable across all treatment groups. Therefore, our block copolymer nanoparticles, PL1RA and PC1RA, are attractive and effective vehicles for atRA delivery which maintain its activity and enhance its stability resulting in efficient induction of HL-60 differentiation.