Chitosan nanoparticles have gained attention as drug delivery systems (DDS) in the medical field as they are both biodegradable and biocompatible with reported antimicrobial and anti-leishmanial activities. We investigated the application of chitosan nanoparticles as a DDS for the treatment of cutaneous leishmaniasis (CL) by preparing two types of chitosan nanoparticles: positively charged with tripolyphosphate sodium (TPP) and negatively charged with dextran sulphate. Amphotericin B (AmB) was incorporated into these nanoparticles. Both types of AmB-loaded nanoparticles demonstrated in vitro activity against Leishmania major intracellular amastigotes, with similar activity to unencapsulated AmB, but with a significant lower toxicity to KB-cells and red blood cells. In murine models of CL caused by L. major, intravenous administration of AmB-loaded chitosan-TPP nanoparticles (Size = 69 ± 8 nm, Zeta potential = 25.5 ± 1 mV, 5 mg/kg/for 10 days on alternate days) showed a significantly higher efficacy than AmBisome® (10 mg/kg/for 10 days on alternate days) in terms of reduction of lesion size and parasite load (measured by both bioluminescence and qPCR). Poor drug permeation into and through mouse skin, using Franz diffusion cells, showed that AmB-loaded chitosan nanoparticles are not appropriate candidates for topical treatment of CL.