The use of magnetic nanoparticles has greatly expanded for numerous biomedical applications over the past two decades due to their high surface area, size-dependent superparamagnetic properties, precision tunability, and easy surface modification. Magnetic nanoparticles can be engineered and manipulated with other nanoparticles and functional compounds to form multi-modal systems useful in theragnosis. However, superior biocompatibility, high loading efficacy, regulated drug release, and in vitro and in vivo stability are necessary for the efficient incorporation of these nanoparticles into physiological systems. In recent years, considerable advancements have been made and reported both in synthesis and application, given the broad range of biomedical-related prospective uses of magnetic nanoparticles. Here, in this review, we have highlighted some essential works, specifically related to the application of magnetic nanoparticles in drug delivery, magnetic hyperthermia, magnetic resonance imaging, magnetic particle imaging, biosensors, and tissue engineering.