My sister told me that I can adopt my nephew when he was born two years ago. I have had him since he was 2 days old. She has not contacted us, nor supported him in two years.
She sent a certified letter stating she wants him back about 2 days ago. Do I have rights? Can she just come get him in the state of Florida?
Can I still adopt him or is this going to be a custody battle?

Legally she is the mother and has all the rights. Adopting him would require her consent and that of the father if his whereabouts are known. Having a "verbal agreement" from her won't cut it. From the sound of things it's going to turn into a custody battle. You can file a motion in Family Court for custody. Your sister will probably contest the motion. Then it'll all be up to the judge. But I have to say, as the mother your sister will definitely have the edge and you'll have a tough, uphill battle.

She signed a consent to terminate her perental rights, the biological father did as well, but it was not notorized. Also I have proof from nurses that her intent was to give him up for adoption. Will she she win?

Unless it's notorized - it's going to be a struggle. Do you have an attorney? They've been gone for more than a specified period - you can have the attorney go after her/them for abandonment claims. You should get an attorney - it's worth the money save your little boy. We had to go through this with my nephew and I would do whatever I needed to in order to save my boy from any pain. It's a tough road... you're in my thoughts and prayers. I admire your courage!