The present study describes the isolation, characterization and in vitro cytotoxic effect of all forced degradation products of niclosamide (NCM) an anthelmintic class of drug used specifically to treat tapeworms. NCM was subjected to forced degradation involving hydrolysis (acidic, alkaline and neutral), oxidative, photolysis and thermal stress, as per ICH (Q1A (R2)) suggested conditions. The drug under hydrolytic (acidic and basic) conditions showed extensive degradation, while it was stable under neutral hydrolytic, oxidative, photolytic and thermal stress conditions. A total of four degradation products (DPs) were observed and chromatographic separation of drug and its degradation products were achieved on a reverse phase Fortis diphenyl column (150 × 4.6 mm, 5 μm) using 0.1% formic acid and acetonitrile as mobile phase in gradient mode. All the four degradation products were isolated by semi preparative LC and its structures were characterized and confirmed by high resolution MS and 1H NMR spectroscopic techniques. In view of safety aspects, cytotoxicity assay were carried out for NCM and its four degradation products on human mononuclear cells and cell lines depicting the major organelle: neuronal (Neuro 2a), hepatic (HepG 2) and alveolar (A549). NCM was found to be non toxic on human mononuclear cells and cell lines at tested concentrations. However DP-1, DP-2, DP-3 and DP-4 showed significant increase in LDH release as compared to control at a concentration of 100 μM. DP-1 and DP-3 exhibited toxicity on A549 cells with an IC50 of 92.18 ± 4.93 μM and 65.42 ± 6.29 μM respectively. DP-2, DP-3 and DP-4 were cytotoxic to Neuro 2a cells with an IC50 of 63.62 ± 3.85 μM, 86.09 ± 6.19 μM and 42.81 ± 8.10 μM respectively. The degradation products were found to be nontoxic on HepG 2 cells.