Multifunctional magnetic nanoparticles and derivative nanocomposites have aroused great concern for multimode imaging and cancer synergistic therapies in recent years. Among the rest, functional magnetic iron oxide nanoparticles (FeO NPs) have shown great potential as an advanced platform because of their inherent magnetic resonance imaging (MRI), biocatalytic activity (nanozyme), magnetic hyperthermia treatment (MHT), photo-responsive therapy and drug delivery for chemotherapy and gene therapy. Magnetic FeO NPs can be synthesized through several methods and easily surface modified with biocompatible materials or active targeting moieties. The MRI capacity could be appropriately modulated to induce response between and modes by controlling the size distribution of FeO NPs. Besides, small-size nanoparticles are also desired due to the enhanced permeation and retention (EPR) effect, thus the imaging and therapeutic efficiency of FeO NP-based platforms can be further improved. Here, we firstly retrospect the typical synthesis and surface modification methods of magnetic FeO NPs. Then, the latest biomedical application including responsive MRI, multimodal imaging, nanozyme, MHT, photo-responsive therapy and drug delivery, the mechanism of corresponding treatments and cooperation therapeutics of multifunctional FeO NPs are also be explained. Finally, we also outline a brief discussion and perspective on the possibility of further clinical translations of these multifunctional nanomaterials. This review would provide a comprehensive reference for readers to understand the multifunctional FeO NPs in cancer diagnosis and treatment.