The objective of this work is to develop a new method for extracting nanocrystalline cellulose (CNC) from eucalyptus. CNC was isolated from eucalyptus using 6:4 (v/v) tetrahydrofuran/water. The chemical and crystalline structure of the isolated CNC was characterized by zeta potential measurements, Fourier Transform Infrared (FT-IR) and UV-Vis spectroscopies, and X-ray powder diffractometry. The CNC morphology was characterized by Transmission Electron Microscope (TEM) and particle size of CNC was determined by the Dynamic Light Scattering (DLS) method. Cytotoxicity and zebrafish-toxicity experiments were also performed on CNC. The yield of CNC using the new extraction method was about 41%, and the extracted CNC particles were about 20 nm in diameter and about 40 nm long, on average. The zeta potential of the CNC was determined to be -56 eV and the CN particles were uniformly distributed in a suspension of 0.5 wt%. The prepared CNC was a type I polymorph with an intact crystal structure. Toxicity results revealed that 0.5 wt% is a safe CNC concentration, and that 2.5 mg/mL CNC is not teratogenic or lethal to zebrafish embryos or juveniles. The new extraction method developed in this study is environmentally friendly, and easy to operate with relatively low cost.