Magnetite occurs widely in natural environments in both inorganic and biogenic forms. Discrimination of the origin of magnetite has important implications, from searching for past microbial activity to interpreting paleomagnetic and environmental magnetic records in a wide range of settings. In this study, we present rock magnetic and electron microscopic analyses of marine sediments from the continental margin of Oman. Low‐temperature magnetic data reveal two distinct Verwey transition (T_v) temperatures that are associated with the presence of biogenic and inorganic magnetite. This interpretation is consistent with room temperature magnetic properties and is confirmed by electron microscopic analyses. Our study justifies the use of two distinct T_v temperatures as a diagnostic signature for discriminating inorganic and biogenic magnetite. Simple low‐temperature magnetic measurements, therefore, provide a tool to recognize rapidly the origin of magnetite within natural samples. In addition, our analyses reveal progressive down‐core dissolution of detrital and biogenic magnetite, but with preservation of significant amounts of fine‐grained magnetite within sediments that have been subjected to severe diagenetic alteration. We demonstrate that preservation of magnetite in such environments is due to protection of fine‐grained magnetite inclusions within silicate hosts. Our results, therefore, also provide new insights into diagenetic processes in marine sediments.