Anyone know about any technique to block sniffing of the network traffic... sniffing is being done by a PC which is part of same network.

promiscan can detect sniffing, so if you detect a host sniffing then perhaps you could block that IP address
hxxp://www.securityfriday.com/products/promiscan.html

winarpwatch can detect arp spoofing (among many other tools - ettercarp, etc) which normally complements sniffing on a switched network
hxxp://www.arp-sk.org/

also read this
hxxp://www.securityfriday.com/promiscuous_detection_01.pdf

nuorder

that pdf about how to detect a sniffer is a damn good paper

Thx for the read will help me out in further investigations.