Magnetic iron oxide nanoparticles have been shown to be suitable for use as theranostic agents owing to their intrinsic diagnostic capabilities in magnetic resonance imaging (MRI) applications, hyperthermia properties, and ability to deliver drugs via magnetic attraction and/or systemic delivery. In addition, surface modifications are easily introduced through conjugation with targeting moieties (e.g., antibodies, peptides, or aptamers), genes, or therapeutic drugs to provide multimodal functionalities. Such valuable characteristics apply to image-guided drug delivery, especially MRI-guided drug delivery-a form of individualized therapy in which imaging methods are used to guide and monitor delivery of therapeutic agents to target tissues. This review summarizes the intrinsic physicochemical properties and pharmacokinetics of magnetic nanoparticles and highlights recent reports describing theranostic systems, including magnetic nanoparticle-based nanoplatforms, and their applications in MRI-guided drug delivery.