Hafnium nitride nanoparticles (HfN NPs) can offer appealing plasmonic properties at the nanoscale, but the fabrication of stable water-dispersible solutions of non-toxic HfN NPs exhibiting plasmonic features in the window of relative biological transparency presents a great challenge. Here, we demonstrate a solution to this problem by employing ultrashort (femtosecond) laser ablation from a HfN target in organic solutions, followed by a coating of the formed NPs with polyethylene glycol (PEG) and subsequent dispersion in water. We show that the fabricated NPs exhibit plasmonic absorption bands with maxima around 590 nm, 620 nm, and 650 nm, depending on the synthesis environment (ethanol, acetone, and acetonitrile, respectively), which are largely red-shifted compared to what is expected from pure HfN NPs. The observed shift is explained by including nitrogen-deficient hafnium nitride and hafnium oxynitride phases inside the core and oxynitride coating of NPs, as follows from a series of structural characterization studies. We then show that the NPs can provide a strong photothermal effect under 808 nm excitation with a photothermal conversion coefficient of about 62%, which is comparable to the best values reported for plasmonic NPs. MTT and clonogenic assays evidenced very low cytotoxicity of PEG-coated HfN NPs to cancer cells from different tissues up to 100 μg mL concentrations. We finally report a strong photothermal therapeutic effect of HfN NPs, as shown by 100% cell death under 808 nm light irradiation at NP concentrations lower than 25 μg mL. Combined with additional X-ray theranostic functionalities (CT scan and photon capture therapy) profiting from the high atomic number ( = 72) of Hf, plasmonic HfN NPs promise the development of synergetically enhanced modalities for cancer treatment.