Two-phase gas–liquid microfluidic reactors provide shear processing control of SN-38-loaded polymer nanoparticles (SN-38-PNPs). We prepare SN-38-PNPs from the block copolymer poly(methyl caprolactone-co-caprolactone)-block-poly(ethylene oxides) (P(MCL-co-CL)-b-PEO) using bulk and microfluidic methods and at different drug-to-polymer loading ratios and on-chip flow rates. We show that, as the microfluidic flow rate (Q) increases, encapsulation efficiency and drug loading increase and release half times increase. Slower SN-38 release is obtained at the highest Qvalue (Q= 400 μL/min) than is achieved using a conventional bulk preparation method. For all SN-38-PNP formulations, we find a dominant population (by number) of nanosized particles (<50 nm) along with a small number of larger aggregates (>100 nm). As Qincreases, the size of aggregates decreases through a minimum and then increases, attributed to a flow-variable competition of shear-induced particle breakup and shear-induced particle coalescence. IC25and IC50values of the various SN-38-PNPs against MCF-7 cells show strong flow rate dependencies that mirror trends in particle size. SN-38-PNPs manufactured on-chip at intermediate flow rates show both minimum particle sizes and maximum potencies with a significantly lower IC25value than the bulk-prepared sample. Compared to conventional bulk methods, microfluidic shear processing in two-phase reactors provides controlled manufacturing routes for optimizing and improving the properties of SN-38 nanomedicines.