The application of magnetic nanoparticles has significantly increased for various biomedical purposes throughout history, owing to their high surface area, size-dependent superparamagnetic features, adjustability in properties, and ability for surface modification. Magnetic nanoparticles can be combined with other nanoparticles and functional materials to create multi-modal systems that are beneficial for theragnosis. Nevertheless, optimal biocompatibility, high drug loading capacity, controlled drug release, and stability in both in vitro and in vivo settings are essential for the successful integration of these nanoparticles into biological systems. Recently, substantial progress has been observed and documented in both the synthesis and application of magnetic nanoparticles, considering their wide range of potential biomedical applications. In this review, we have emphasized important studies related to bio-synthesis, characterization, and biomedical uses of magnetic nanoparticles.