This study focuses on encapsulating the biologically active compound Nileblue (NB) within α, β and γcyclodextrins (CDs). CDs are widely used by pharmaceutical companies for drug delivery applications. Various spectroscopic techniques including time-resolved, steady-state and UV-visible spectroscopy, were employed to determine the extent of NB encapsulation within the cavities of CDs. Fluorescence lifetime measurements confirmed the formation of ground-state complexes, indicating static quenching. The binding interaction between NB and β-CD was further investigated by calculating thermodynamic parameters. The mode of inclusion complex formation was elucidated using NMR data. DFT calculations were performed to support these findings, demonstrating that NB fits comfortably inside the β-CD cavity. The in vitro Brine Shrimp toxicity (BST) assay was used to evaluate the toxicity of NB and its inclusion complex. Our results suggest that NB can be safely encapsulated in β-CD for applications in living systems without compromising its beneficial properties. © 2024 Elsevier B.V., All rights reserved.