The chemopreventive actions exerted by green tea are thought to be due to its major polyphenol, (-)-epigallocatechin-3-gallate (EGCG). However, the low level of stability and bioavailability in the body makes administering EGCG at chemopreventive doses unrealistic. We synthesized EGCG encapsulated chitosan-coated nanoliposomes (CSLIPO-EGCG), and observed their antiproliferative and proapoptotic effect in MCF7 breast cancer cells. CSLIPO-EGCG significantly enhanced EGCG stability, improved sustained release, increased intracellular EGCG content in MCF7 cells, induced apoptosis of MCF7 cells, and inhibited MCF7 cell proliferation compared to native EGCG and void CSLIPO. The CSLIPO-EGCG retained its antiproliferative and proapoptotic effectiveness at 10 μM or lower, at which native EGCG does not have any beneficial effects. This study portends a potential breakthrough in the prevention or even treatment of breast cancer by using biocompatible and biodegradable CSLIPO-EGCG with enhanced chemopreventive efficacy and minimized immunogenicity and side-effects.