What are the potential health and environmental impacts on nanotechnology?

There has been considerable media attention given to the potential health and environmental impacts that new nanotechnologies may present. It is difficult to generalise on the potential risk of nanotechnology as it represents a hugely diverse number of different technologies.
 
One of the main concerns which is often mentioned about nanotechnology is that of 'grey goo' formed from nanomachines or nanobots which are capable of making copies of themselves, as set out by Michael Crichton in his book 'Prey'. The production of such devices is firmly within the realms of science fiction. 

One cause of some concern is the potential health and safety risks of nanoparticles and nanotubes. It is known that nanoscale particles are likely to be more reactive than the same material in bulk, and that nanoparticles may be able to penetrate human cells. However, there is no evidence that the limited number of nanoparticles used in cosmetics can cause any damage. At present there is little research into the general toxicity of nanoparticles with respect to damage to DNA or lungs. More evidence is needed to understand if there is any cause for concern and more research needs to be carried out by the scientific community.