Nanofluids consist of nanoparticles made of materials with high thermal conductivity suspended in a base fluid such as water. In theory, the presence of thermally conductive nanoparticles in a base fluid improves the heat transfer performance of the resulting nanofluid. This article numerically investigates the impact of nanoparticles on the energy performance of a district cooling system. The current work focuses on using Cu–water nanofluid as the working fluid for the secondary chilled water loop. It examines the effect of varying the nanoparticles concentration, nanofluid flowrate, and return temperature on the system energy performance. The numerical model is built using the engineering equation solver (EES) and validated using operational data obtained from the McQuay chilled water system operating in one of the university central facility plants. In the current numerical model, the Reynolds number in the shell side of the heat exchanger is varied between 2200 and 8800 at a volume fraction of 0.02. The result shows that for a fixed cooling capacity of 280 kW, the Cu–water nanofluid reduced the mass flowrate by 4.8% and the corresponding pump work input by 33.6%. This improved energy performance of the circulating water reduced the overall chiller system work input by 3.8% and increased the corresponding system coefficient of performance (COP) by 3.9%. The current findings reveal the potential impact and opportunity of nanofluids on the effectiveness of the district cooling system chiller water loop and the associated overall energy performance.