The recent rise of multidrug resistant microbial strains requires development of new and novel therapeutic alternatives. In this study, we present a novel antibacterial system that comprises of modified naturally abundant antimicrobial peptides in conjugation with silver nanoparticles. Further, we propose a simple route to incorporate a cysteine residue either at the N- or C-terminal of the parent peptide. Tagging a cysteine residue at the terminals not only enhances the binding propensity of the resultant peptide with the silver nanoparticle, but also increases its antimicrobial property against several pathogenic bacterial strains including K. pneumoniae. The minimum inhibitory concentration (MIC) values of the cysteine tagged nanoconjugates were obtained in the range of 5-15 μM compared to 50 μM for peptides devoid of the cysteines. The origin and mechanism of such improved activity of the conjugates were investigated using NMR spectroscopy and molecular dynamics (MD) simulations. The application of 13C-isotope labelled media to track the metabolic lifecycle of E. coli cells provided further insights into the system. MD simulations showed that pore formation in membrane bilayer is mediated through a hydrophobic collapse mechanism. The design strategy described herein opens up new-avenues for using biocompatible nanomedicines as a potential alternative to conventional antibiotics.