Over the past few decades nanotechnology and material science has progressed extremely rapidly. Iron oxide nanoparticles (IONPs) owing to their unique magnetic properties have a great potential for their biomedical and bioengineering applications. However, there is an inevitable need to address the issue of safety and health effects of these nanoparticles. Hence, the present study was aimed to assess the cytotoxic effects of IONPs on rats' lymphocytes. Using different assays, we studied diverse parameters including mitochondrial membrane potential, intracellular accumulation of reactive oxygen species (ROS), lactate dehydrogenase activity, antioxidant enzymes activity and DNA damage measurements. Intracellular metal uptake and ultrastructure analysis were also carried out through inductively coupled plasma atomic emission spectroscopy, transmission electron microscopy respectively. The results show that the IONP-induced oxidative stress was concentration-dependent in nature, with significant (P < 0.05) increase in ROS levels, lipid peroxidation level as well as depletion of antioxidant enzymes and glutathione. Moreover, we observed morphological changes in the cell after intracellular uptake and localization of nanoparticles in cells. From the findings of the study, it may be concluded that IONPs induce ROS-mediated cytotoxicity in lymphocytes. Copyright © 2017 John Wiley & Sons, Ltd.