IR780 is a near-infrared fluorescent dye, which can be applied as a photosensitizer in photodynamic (PDT) and photothermal (PTT) therapies and as a biodistribution tracer in imaging techniques. We investigated the growth and migration inhibition and mechanism of death of breast tumor cells, MCF-7 and MDA-MB-231, exposed to polymeric nanocapsules (NC) comprising IR780 covalently linked to the biodegradable polymer PLA (IR-PLA) and IR780 physically encapsulated (IR780-NC) in vitro. Both types of NC had mean diameters around 120 nm and zeta potentials around −40 mV. IR-PLA-NC was less cytotoxic than IR780 NC to a non-tumorigenic mammary epithelial cell line, MCF-10A, which is an important aspect of selectivity. Free-IR780 was more cytotoxic than IR-PLA-NC for MCF-7 and MDA-MB-231 cells after illumination with a 808 nm laser. IR-PLA NC was effective to inhibit colony formation (50%) and migration (30–40%) for both cancer cell lines. MDA-MB-231 cells were less sensitive to all IR780 formulations compared to MCF-7 cells. Cell uptake was higher with IR-PLA-NC than with IR780-NC and free-IR780 in both cancer cell lines (p < 0.05). NC uptake was higher in MCF-7 than in MDA-MB-231 cells. IR-PLA-NC induced a higher percentage of apoptosis upon illumination in MDA-MB-231 than in MCF-7 cells. The necrosis mechanism of death predominated in treatments with free-IR780 and with encapsulated IR780 NC, suggestive of damages at the plasma membrane. IR780 conjugated with PLA increased the apoptotic pathway and demonstrated potential as a multifunctional theranostic agent for breast cancer treatment with increased cellular uptake, photodynamic activity and more reliable tracking in cell-image studies.