It is known that the metal nanoparticles, when dispersed in fluids to form nanofluids, improve the heat conductivity of the fluids. The present paper studies the flow and heat transfer of the nanofluids in a microchannel by using Computational Fluid Dynamic method. It is found that although the nanoparticles enhance the heat transfer of the fluids about certain percent, the nanoparticles also cause a big increase of viscous shear stress on the wall, which causes an increase of the power consumption for driving the nanofluids through the microchannel.