The advantages of integrating microfluidics into photonics-based biosensing for fabricating microreactor type lab-on-a-chip devices carries a lot of advantages, such as smaller sample volume handling, controlled drug delivery and high throughput diagnosis, which is useful for in situ medical diagnosis and point-of-care (POC) testing. A hybrid integrated optical microfluidic system has been developed for the study of single molecules and enzymatic reactions. The method of optical absorption has been employed for biosensing and the feasibility of absorption-based detection on the microfluidic platform has been demonstrated using horseradish peroxidase and hydrogen peroxide, as an example. The results show that the device is useful for the analysis of both the individual chemical specimen and also the study of chemical and biological reaction between two reacting species. The hybrid integration of microfluidics and optical ensembles thus forms the basis for developing the microreactor type lab-on-a-chip device, which would have several important applications in the area of nanobiotechnology.