Treatment of cancer is one of the most challenging problems and conventional therapies are inadequate for targeted, effective and safe therapy. Development of nanoparticle-based drug delivery systems emerge as promising carriers in this field to ensure delivery of anticancer drug to tumor site. The aim of this study was to design hydroxypropyl-beta-cyclodextrin (CD) coated nanoparticles using poly(epsilon-caprolactone) (PCL) and its derivative poly(ethylene glycol)-block-poly(epsilon-caprolactone) (mePEG-PCL) to be applied as implants to tumor site following surgical operation in cancer patients. CD coated PCL and mePEG-PCL nanospheres were developed to encapsulate poorly soluble chemotherapeutic agent docetaxel (DOC) to improve solubility of drug and to enhance cellular penetration with longer residence time and higher local drug concentration. Nanospheres were prepared according to the nanoprecipitation method and coated with hydroxypropyl-beta-cyclodextrin (Cavasol(A (R)) W7HP). Cyclodextrin coating was performed for higher drug encapsulation and controlled but complete drug release from nanoparticles. Nanoparticle diameters varied between 60 and 136 nm depending on polymer used for preparation and coating. All nanoparticles have negative surface charge and zeta potential values varied between -22 and -37 mV. Encapsulation efficiency of formulations were found to be between 46 and 73 % and CD coated nanoparticles have significantly higher entrapment efficiency. Drug release profiles of nanoparticles were similar to each other and all formulations released encapsulated drug in approximately 12 h. Especially, CD-PCL nanoparticles were found to have highest entrapment efficiency and anticancer efficacy against MCF-7 human breast adenocarcinoma cell lines. Our study proved that polycaprolactone and its PEGylated derivatives can be suitable for development of implantable nanoparticles as a potential drug delivery system of DOC for cancer treatment and a good candidate for further in vivo studies.