The magnetic doxorubicin-encapsulated liposome/PEG/FeO (called as DOX@m-Lip/PEG) was synthesized and studied as a novel nanocarrier for the treatment of breast cancer in BALB/c mice. Nanocarrier was characterized by FT-IR, zeta-potential sizer, EDX elemental analysis, EDX mapping, TEM, and DLS techniques. The results showed that the size of the nanocarrier was determined around 128 nm by TEM. EDX study confirmed PEG-conjugation in the magnetic liposomes and was homogenously distributed in the nanosize range (100-200 nm) with a negative surface charge (-61.7 mV). The kinetic studies indicated that the release of doxorubicin from DOX@m-Lip/PEG follows the Korsmeyer-Peppas model. The n-value of the model was 0.315, indicating that doxorubicin release from the nanocarrier had a slow releasing rate and followed Fick's law. The DOX release from the nanocarrier lasted a long time (more than 300 h). In in vivo part, a mouse 4T1 breast tumor model was used. The in vivo results indicated that DOX@m-Lip/PEG caused much stronger tumor cell necrosis and less cardiotoxic effects than the other groups. In conclusion, we show that m-Lip/PEG is a promising nanocarrier for low dosage and slow release of doxorubicin in treating breast cancer, and treatment with encapsulated DOX (DOX@m-Lip/PEG) demonstrated higher efficacy with low cardiac toxicity. Besides, the magnetic property of m-Lip@PEG nanocarrier allows it to be a potent mater for hyperthermia and MRI studies.