Engineered Nanomaterials (ENMs) are materials with any internal or external structures in the nanoscale and Nanoparticles (NPs) are particles having at least one dimension in the range of 1 to 100 nm. ENMs are extensively used in various applications owing to their distinct electronic, optical, and mechanical properties that distinguish them from bulk materials. The unprecedented release of ENMs from domestic products into the wastewater streams can potentially impact the performance of Wastewater Treatment Plants (WWTPs) and endanger the environment in which they are disposed of eventually. The difficulty associated with the characterization of ENMs in complex environmental matrices like wastewater and state-of-the-art techniques for quantifying ENMs in wastewater has been discussed. A comprehensive literature review about the interaction of ENMs in primary treatment units, the impact on biological treatment units and tertiary treatment systems has been presented. It is evident that a significant fraction of ENMs entering WWTPs has been removed as sludge; hence the fate and impact of ENMs during sludge handling and biogas production have been discussed in detail. In the present study, nanoparticles are quantified in wastewater and sludge collected from two WWTPs located in Chennai city. Preliminary lab-scale studies were carried out to assess the impact of ENMs on the settling of suspended solids in the synthetically prepared solution. As the WWTPs have been proven to act as a significant point source for the discharge of NPs into the environment, the fate of nanoparticles in the environment (both the concentration and form) depends on their transformation in WWTPs. Hence, the present research focuses on ascertaining their fate and impact on WWTPs.