The aim of this study was to develop and characterize nanocrystal formulation containing nimesulide. Physical mixture of drug and excipient (nimesulide: pluronic F127, 1:0.5) was also prepared to compare the efficiency of formulations. The physicochemical characteristics of the formulations were determined by means of Fourier transform infrared spectroscopy (FT-IR), differential scanning calorimetry (DSC), and X-ray diffractometry. Particle size, saturation solubilities as a function of pH, and permeability across Caco-2 monolayers were determined for nimesulide in powder, physical mixture, and nanocrystal formulations. In FT-IR analysis, the characteristic peaks that belong to nimesulide were seen in all formulations. X-ray diffractograms displayed that crystalline structure of nimesulide was conserved in the nanocrystal formulation. The interaction between nimesulide and pluronic F127 was demonstrated by DSC analysis. In all conditions, the average particle size of the nanocrystal formulations decreased significantly (p < 0.05) as compared with nimesulide and physical mixture. The solubility of nimesulide in nanocrystal formulation was higher than those of nimesulide in powder and physical mixture. Permeability studies revealed that nimesulide is a highly permeable compound whether in powder form or in physical mixture and nanocrystal formulation. All these results clearly demonstrate that aqueous solubility of poorly water-soluble compounds can be improved by preparing nanocrystal formulations.