In this paper, amidoxime functionalized cellulose (AOFC) derivatives have been synthesized by a two step approach and characterized. Firstly, cyanoethyl cellulose (CEC) was synthesized by using Michael addition between acrylonitrile and hydroxyl groups of cellulose in the homogeneous cellulose/NaOH/urea solution. The nitrile groups of CEC were then converted into amidoxime groups using NH2OH. The optimal reaction parameters for the amidoximization are at a pH of 7 and a reaction temperature of 75 °C. More than 90% of the nitrile groups of CEC can be converted into amidoxime groups after the reactions were carried out under these conditions for 8 h. The degree of substitution of amidoxime groups per glucose unit of cellulose can be adjusted by varying the feeding molar ratio of the acrylonitrile to the anhydroglucose units in the reaction solution during the synthesis of CEC. The new cellulose derivative AOFC can be used as both a reducing agent and stabilizer for preparing gold nanoparticles (AuNPs). The AOFC stabilized AuNPs have the excellent stability in whole pH range, which may have the promising applications in the fields of catalysis, biotechnology and medicine.