Undoped and Mn doped CdS nanoparticles with varying Mn concentration of 10,15 and 20 mol % have been prepared by chemical co-precipitation method with polyvinylpyrrolidone (PVP) as capping agent at room temperature. EDAX has shown that no foreign impurities are present in the synthesized nanoparticles and X-ray diffraction (XRD) revealed that undoped and Mn doped CdS nanoparticles possess cubic phase with crystallite size ranging from 4-6 nm. Transmission electron microscopy (TEM) images indicated that nanoparticle sizes are between 2-6 nm and exhibits polycrystalline nature as seen from selected area electron diffraction (SAED) pattern. Raman spectra of undoped and Mn-doped CdS nanoparticles have shown 1LO and 2LO phonon modes and their intensity ratio decreases as Mn concentration increases. Magnetic susceptibility clearly pointed out that undoped CdS behaves as diamagnetic whereas Mn doped CdS as paramagnetic and varies nonlinearly with Mn concentration in CdS. Rapid increase in magnetization below 50 K temperature is observed in M-T curves which can be assigned to Mn ions isolated in CdS crystal field or extrinsic defects. The M-H curve at 5 K and 300 K for 20% Mn doped CdS nanoparticles at different magnetic fields showed no hystersis. In near future Mn doped CdS nanoparticles can be used for application in dilute magnetic semiconductor and fabrication of solar cells. The result and discussion drawn from this work are elaborated in detail in the paper.