A novel biomaterial poly(ethylene glycol)-block-poly(γ-cholesterol-l-glutamate) (mPEG-PCHLG) was designed and synthesized by introducing cholesterol side chains into this pegylated poly(amino acid) copolymers to enlarge the core space to increase the drug capacity. Paclitaxel (PTX) loaded mPEG-PCHLG nanoparticles (PTX-mPEG-PCHLG-Nps) were developed for the first time. The preparation method of nanoparticles was screened and optimized systemically. The optimal PTX-mPEG-PCHLG-Nps with the average diameter of 213.71 nm were constructed through the O/W single-emulsion solvent evaporation method. The entrapment efficiency and drug loading was 38.02 ± 4.51% and 93.90 ± 4.56%, respectively. PTX-mPEG-PCHLG-Nps were spherical and well-dispersed and displayed a dramatic sustained-release property. The in vitro cytotoxicity experiments demonstrated that the blank mPEG-PCHLG nanoparticles had no cytotoxicities on four tumor cell lines including A549, HepG-2, MCF-7 and C26, which implied that mPEG-PCHLG might be biocompatible. PTX-mPEG-PCHLG-Nps obtained the same cell growth inhibition activities as free PTX when incubated with the above tumor cells for 48 h. It can be inferred that PTX-mPEG-PCHLG-Nps could probably have higher anticancer efficacy due to the inadequate release of PTX from nanoparticles. PTX-mPEG-PCHLG-Nps achieved the highest antitumor activity in A549 rather than HepG-2, MCF-7 and C26, thus PTX-mPEG-PCHLG-Nps could have a potential application in lung cancer therapy. All the data indicated that mPEG-PCHLG was one of biocompatible biomaterials and worth being widely investigated as hydrophobic antitumor drug carrier.