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Silver nanoparticles (AgNPs) are widely used in commerce, however, the effect of their physicochemical properties on toxicity remains debatable because of the confounding presence of Ag+ ions. Thus, we designed a series of AgNPs that are stable to surface oxidation and Ag+ ion release. AgNPs were coated with a hybrid lipid membrane comprised of L-phosphatidylcholine (PC), sodium oleate (SOA), and a stoichiometric amount of hexanethiol (HT) to produce oxidant-resistant AgNPs, Ag–SOA–PC–HT. The stability of 7-month aged, 20–100 nm Ag–SOA–PC–HT NPs were assessed using UV–Vis, dynamic light scattering (DLS), and inductively coupled plasma mass spectrometry (ICP-MS), while the toxicity of the nanomaterials was assessed using a well-established, 5-day embryonic zebrafish assay at concentrations ranging from 0–12 mg/L. There was no change in the size of the AgNPs from freshly made samples or 7-month aged samples and minimal Ag+ ion release (<0.2%) in fishwater (FW) up to seven days. Toxicity studies revealed AgNP size- and concentration-dependent effects. Increased mortality and sublethal morphological abnormalities were observed at higher concentrations with smaller nanoparticle sizes. This study, for the first time, determined the effect of AgNP size on toxicity in the absence of Ag+ ions as a confounding variable.