It is not difficult to read Nagarjuna’s Shunyavada (Madhyamaka) and safely come away with a nihilist interpretation of it. Buddhist scholars in the past like E. Burnouf, H. Jacobi, A.B. Keith and L. de La Vallée Poussin argued that Nagarjuna’s Shunyavada was nihilism. In other words, nothing really exists the way we believe it does and therefore nothing is really knowable.
On the other hand, there is a non-nihilist interpretation of Shunyavada. T.R.V. Murti argues in his book, The Central Philosophy of Buddhism, that Shunyavada is only denying doctrines about the real, not the real itself which is transcendent to thought. This makes Shunyavada "a very consistent form of absolutism".
Another interpretation, which I think is significant and a better reading of Nagarjuna’s Mula-madhyamaka-karikas, comes from discovering astonishing parallels between the Greek Pyrrhonism of Sextus Empiricus and Shunyavada. The correspondence between the two schools in gone over in Thomas McEvilley’s book, The Shape of Ancient Thought. With the Skeptics and the Shunyavadins, according to McEvilley, there is “an insistent tendency to breach the Law of the Excluded Middle” (p. 470). McEvilley states that Madhyamaka “is expressly devoted to the controversion of that principle of thought [Law of the Excluded Middle], to the farming, as it were, of the land in the excluded-middle zone” which also Sextus’s Pyrrhonism “finds its most comfortable location in the same place” (p. 455).
In this regard, Shunyavada can be read as Buddhist Pyrrhonism which, like the Pyrrhonism of Sextus Empiricus, even destroys itself. After all Nagarjuna said in the Lokâtîtastava: "The ambrosial teaching of emptiness aims at abolishing all conceptions. But if someone believes in shunyata You [have declared] he is lost." This may help pave the way for the realization of the transcendent (this brings us back to Murti’s absolutism). Still, this is not positive proof that Nagarjuna, with his Pyrrhonism, was clearing the way for positive transcendence. But it doesn’t rule it out especially in other works attributed to Nagarjuna which are not in the same genre as his popular Mula-madhyamaka-karikas. Still there is a danger with such vagueness. Does Shunyavada really lead us to nihilism which makes it a philosophy of absolute nothingness or voidness? For those who are materialists, reading Nagarjuna as a nihilist is certainly easy.