The development of multifunctional nanocomposite materials is of great interestfor various biomedical applications. A popular approach to produce tailorednanocomposites is to incorporate functional nanoparticles into hydrogels. Here, abenign atmospheric pressure microplasma synthesis approach has been deployedfor the synthesis of metal and alloy NPs in-situ in a poly (vinyl alcohol) hydrogel.The formation of gold, silver, and gold-silver alloy NPs was confirmed viaspectroscopic and microscopic characterization techniques. The properties of thehydrogel were not compromisedduring formation of thecomposites. Practical applicationsof the NP/PVA nanocompositeshas been demonstratedby anti-bacterial testing. Thisestablishes AMP processing asa viable one-step technique forthe fabrication of NP/hydrogelcomposites, with potential multifunctionalityfor a range of biomedical applications.