Zinc oxide nanoparticles (ZnO NPs) are used in many applications; however, their interactions with cells, immune cells in particular, and potential health risk(s) are not fully known. In this manuscript, we have demonstrated the potential of ZnO NPs to cross the gut barrier in an invertebrate model, Bombyx mori, and that they can reach the hemolymph where they interact with and/or are taken up by immune-competent cells resulting in various toxic responses like decline in hemocyte viability, ROS generation, morphological alterations, apoptotic cell death, etc. Exposure to these NPs also resulted in alteration of hemocyte dynamics including an immediate increase in THC, possibly due to the release of these hemocytes either from enhanced rate of cell divisions or from attached hemocyte populations, and decline in percentage of prohemocytes and increase in percentage of two professional phagocytes, i.e., granulocytes and plasmatocytes, possibly due to the differentiation of prohemocytes into phagocytes in response to a perceived immune challenge posed by these NPs. Taken together, our data suggest that ZnO NPs have the potential to cross gut barrier and cause various toxic effects that could reverse and the insects could return to normal physiological states as there is restoration and repair of various systems and their affected pathways following the clearance of these NPs from the insect body. Our study also indicates that B. mori has the potential to serve as an effective alternate animal model for biosafety, environmental monitoring and screening of NPs, particularly to evaluate their interactions with invertebrate immune system.