In this work, the extraction of carboxylated nanocrystalline cellulose from oat husk as an agricultural waste was conducted by ammonium persulfate oxidation. This is a one-step and efficient process for removal of amorphous regions from cellulosic fibers. The mean size of cellulose nanoparticles is about 30 nm with spherical morphology. The comparison of the infrared spectrum of the nanoparticles of cellulose and the primary oat husk evidences the successful elimination of non-cellulosic structures such as hemicellulose, lignin in nanocellulose sample. The X-ray diffraction patterns show higher degree of crystalline index in nanocellulose (57%) compared to the primary oat husk (38%). The comparison of the onsets of temperature degradation of the samples shows nanocellulose is less thermally stable than oat husk. The hydrophilic surface of the nanocellulose was modified using cetyltrimethylammonium bromide (CTAB) cationic surfactant to improve loading capacity of hydrophobic indomethacin drug which has a low bioavailability and poor solubility in water. In vitro release profile of the indomethacin and drug release mechanism was studied. The results show the 67% of drug is released within 12 h and CTAB modified nanocellulose greatly acts as an indomethacin controlled-release carrier. Study of the in vitro drug release kinetics shows driven mechanism is diffusion-controlled release.