This research demonstrates the synthesis of silica nanoparticles (Si-NPs) via the sol-gel method, followed by tetra-ethyl-orthosilicate and mercaptopropyl tri-methoxy-silane-mediated thiolation to promote the covalent binding of Aspergillus oryzae β-galactosidase. A higher enzyme immobilization yield of 89% was achieved on the developed nanobiocatalyst. Soluble and immobilized enzyme exhibited similar pH and temperature optima at pH 4.5 and 50 °C, respectively. However, β-galactosidase bound to thiolated Si-NPs (IβG) exhibited a significant enhancement in activity under extreme temperatures and pH variations, as compared to the soluble β-galactosidase (SβG), by improving its tolerance towards harsh pH ranges and limiting the thermal movement of the enzyme at higher temperatures. It was further observed that the immobilized enzyme retained 58% activity at a 5% galactose concentration even after 1 hour. However, under similar experimental conditions, SβG showed 23% activity. The reusability of the immobilized enzyme revealed that it retained 63% activity even after the sixth repeated use and hence could be recovered easily by centrifugation for repeated use in biotechnological applications. The batch reactor experiment indicated that the immobilized enzyme displayed 86% and 79% lactose hydrolysis at 50^oC and 60^oC, respectively, as compared to 71% and 60% lactose hydrolysis of the soluble enzyme under identical conditions after 8 h. Future research of the developed nanobiocatalyst is required to analyze its stability in producing lactose-free dairy in continuous reactors products and in the production of galacto-oligosaccharides.