Over the last decade nanofluids, colloidal suspensions of nanoparticles (∼5-100nm) in a base fluid have created excitement, as well as controversy, due to the reported enhanced thermal properties. Most of the research in the past has focused on the thermal characteristics of nanofluids or their performance in micro systems and/or in simple fluid geometries. The objective of this study is to investigate heat transfer performance of nanofluids in an industrial type heat exchanger. Experiments are conducted to compare the overall heat transfer coefficient and pressure drop in a laboratory scale Plate Heat Exchanger (PHE) using nanofluids with that of water. SiO2-water nanofluids consisting of 20±2 nm diameter particles at three different particle mass concentrations of 1%, 3% and 5% are used as the working fluid. The experimental setup consists of the nanofluids in the hot stream and tap water in the cold stream. In addition, pressure drop across the heat exchanger inlet and outlet is also measured to estimate the flow performance of nanofluids. The results show a consistent increase in the total heat transfer coefficient of the heat exchanger for the nanofluids concentrations tested. However, the pressure drop in the hot (nanofluids) flow line also increases that effect can substantially limit the applicability of nanofluids in a PHE.