Composite nanoparticles of aerosol OT-alginate hydrogel loaded with Fe 3 O4 and rhodamine 6G (R6G) in average diameter between 25 nm and 50 nm were synthesized by emulsification-cross-linking process and characterized by transmission electron microscopy (TEM) and SQUID magnetometery measurements. TEM measurements show that the Fe3 O4 particles are uniformly distributed within AOT-alginate nanoparticles. The Ca 2+ cross-linked AOT-alginate nanoparticles loaded with Fe 3O4 and rhodamine showed superparamagnetic behavior at room temperature with saturation magnetization of ∼50 emu/g of Fe 3O4. Similar behavior was exhibited by Fe 2+ crosslinked AOT-alginate nanoparticles loaded with Fe3O4 and rhodamine except it showed twice the magnetization of Ca 2+ crosslinked counterpart. A decrease in the amount of rhodamine loading for the composite nanoparticle systems as compared to the bare AOT-alginate nanoparticles was found. © 2008 IEEE.