We have studied the electronic transport and magnetic properties of a nanocrystalline La_0.7Sr_0.3MnO₃ system. The samples were prepared by sol–gel method and were sintered at different temperatures to achieve few nanometre grain sizes. The temperature dependent resistivity revealed Kondo like electronic transport at low temperature (T < 50 K) and variable range hopping in the paramagnetic insulating regime under zero and high magnetic field. The reduced grain size sample showed marginal increase in electrical resistivity. The temperature-field dependent ac-susceptibility measurement indicated the FM-cluster formation. A neck like magnetic hysteresis loop was observed due to the competition between ferromagnetic core and paramagnetic shell. The ferromagnetic clusters with paramagnetic interfaces impart glassy behavior.