Silver nanoparticles (Ag NPs) of different sizes from 7nm to 22nm have been prepared by simple Dirk and Charles chemical method and characterized using UV-vis spectroscopy and high resolution transmission electron microscopy (HRTEM). Fluorescence quenching of 1,4-dimethoxy-2,3-dimethylanthracene-9,10-dione (DMDMAD) by silver nanoparticles has been investigated by fluorescence spectroscopy to understand the role of quenching mechanism. Furthermore, the intensity of DMDMAD fluorescence emission peak decreases with decrease in the size of the Ag NPs. The fluorescence quenching rate constant and association constant for above system were determined using Stern-Volmer and Benesi-Hildebrand plots. The mechanism of DMDMAD fluorescence quenched by Ag NPs was discussed according to the Stern-Volmer equation. It has been observed that the quenching due to Ag NPs proceeds via dynamic quenching process. The distance between DMDMAD (donor) to Ag NPs (acceptor) and the critical energy transfer distance were estimated based on the Förster Resonance Energy Transfer (FRET) theory.