Magnetic nanoparticles and their magnetofluorescent analogues have become important tools for in vivo imaging using magnetic resonance imaging and fluorescent optical methods. A number of monodisperse magnetic nanoparticle preparations have been developed over the last decade for angiogenesis imaging, cancer staging, tracking of immune cells (monocyte/macrophage, T cells) and for molecular and cellular targeting. Phage display and data mining have enabled the procurement of novel tissue- or receptor-specific peptides, while high-throughput screening of diversity-oriented synthesis libraries has identified small molecules that permit or prevent uptake by specific cell types. Next-generation magnetic nanoparticles are expected to be truly multifunctional, incorporating therapeutic functionalities and further enhancing an already diverse repertoire of capabilities.