Magnetic targeting that utilizes a magnetic field to specifically delivery theranostic agents to targeted tumor regions can greatly improve the cancer treatment efficiency. Herein, we load chlorin e6 (Ce6), a widely used PS molecule in PDT, on polyethylene glycol (PEG) functionalized iron oxide nanoclusters (IONCs), obtaining IONC-PEG-Ce6 as a theranostic agent for dual-mode imaging guided and magnetic-targeting enhanced in vivo PDT. Interestingly, after being loaded on PEGylated IONCs, the absorbance/excitation peak of Ce6 shows an obvious red-shift from ~650 nm to ~700 nm, which locates in the NIR region with improved tissue penetration. Without noticeable dark toxicity, Ce6 loaded IONC-PEG (IONC-PEG-Ce6) exhibits significantly accelerated cellular uptake compared with free Ce6, and thus offers greatly improved in vitro photodynamic cancer cell killing efficiency under a low-power light exposure. After demonstrating the magnetic field (MF) enhanced PDT using IONC-PEG-Ce6, we then further test this concept in animal experiments. Owing to the strong magnetism of IONCs and the long blood-circulation time offered by the condensed PEG coating, IONC-PEG-Ce6 shows strong MF-induced tumor homing ability, as evidenced by in vivo dual modal optical and magnetic resonance (MR) imaging. In vivo PDT experiment based magnetic tumor targeting using IONC-PEG-Ce6 is finally carried out, achieving high therapeutic efficacy with dramatically delayed tumor growth after just a single injection and the MF-enhanced photodynamic treatment. Considering the biodegradability and non-toxicity of iron oxide, our IONC-PEG-Ce6 presented in this work may be a useful multifunctional agent promising in photodynamic cancer treatment under magnetic targeting.