Despite the promising photophysical properties of fluorescent graphene quantum dots (GQDs), their cellular toxicity needs to be addressed before their full potential could be completely realized in biomedicine. A simple method for mitigating the toxicity of GQDs by embedding them in PEG matrix is reported here. The enhanced biocompatibility of polymer modified, P-GQDs, is attributed to reduced reactive oxygen species generation, as measured by an intracellular ROS assay. We also demonstrate the enhanced loading and efficient intracellular delivery of therapeutics by P-GQDs.