Due to the reduction in the size of the electronic components, heat dissipation has become a major problem. In many cases, air cooling has failed to provide the required demands. The invention of nanofluid has promised to increase the efficiency of the liquid cooling system. The addition of solid nanoparticles to the liquid actually increases the thermal conductivity of the liquid because of the higher thermal conductivity of the solid particles. In this work, the thermal performance of a minichannel heat sink was analyzed using CFD for cooling of processor chipset using nanofluids instead of pure water. The effect of different mass flow rates and various volume concentrations of nanoparticles on the overall thermal performance are also analyzed. The Alumina and graphene water nanofluids are used as coolants with volume concentrations of 0.1, 0.15 and 0.2%. The cooling fluid is made to flow through an Aluminium mini channel with height 5mm and width 1mm respectively. The maximum allowable temperature that has to be maintained at the chip is below 50oC. By using the liquid cooling system with a heat sink, this temperature is reduced as low as 41.22oC. There is also an enhancement of the convective heat transfer coefficient in using graphene nanofluids when compared to alumina nanofluids. The thermal resistance of the heat sink with nanofluids is lesser than pure water.