The integration of multiple imaging and therapeutic agents into a customizable nanoplatform for accurate identification and rapid prevention of cancer is attracting great attention. Among the available theranostic nanosystems, magnetic gold nanoparticles are particularly promising as they exhibit unique physicochemical properties that can support multiple functions, including cancer diagnosis by magnetic resonance imaging, X-ray computed tomography, Raman and photoacoustic imaging, drug delivery, and plasmonic photothermal and photodynamic therapies. This review gives an overview of recent advances in the fabrication of multifunctional gold nanohybrids with magnetic and optical properties and their successful demonstration in multimodal imaging and therapy of cancer. Concerns around toxicity of these nanomaterials are also discussed in view of an imminent transition to clinical practice.