Biosynthesis of nanoparticles by plant extracts is currently under exploitation. Plant extracts are very cost effective and eco-friendly and thus can be an economic and efficient alternative. This study investigates the mechanism of preparation of nano-silver using a plant active substance from lemongrass extract. The lemongrass ethanol extract was prepared using an ultrasonic cell crusher. Spherical silver nanoparticles were prepared with lemongrass extract and silver nitrate. The reaction mechanism of the preparation of nano-silver by plant extracts was analyzed by infrared and X-ray photoelectron spectrometer (XPS) measurements. The uniform and stable spherical silver nanoparticles with an average particle size of 22.99 nm were synthesized. Amide compounds in plant extracts may act as reductants and protective agents. The biomass of plants produces their nanomaterials through a process called biomineralisation. Thus, plant active substances can be used widely, and biological methods are completely feasible and worth studying for the chemical procedures, which are environmentally friendly and convenient.