Multifunctional nanoplatforms represent a cutting edge tool in biomedical applications as a result of their applicability in the concurrent monitoring of medical treatment. Magnetic nanoparticles (MNPs) have generated great interest in the field of cancer nanotheranostics owing to their intrinsic magnetic property that enables them to be used as contrast agents in magnetic resonance imaging and as a therapeutic system in conjunction with hyperthermia. In addition, the physical properties and biocompatibility of MNPs help them to act as efficient drug carriers for targeted therapeutic regimes. In this review, we have discussed the different theranostic applications of MNPs. Further, we have raised the current challenges associated with the clinical translation of MNPs along with future opportunities in this field.