Nanoparticles (NPs) exhibit interesting size-dependent electrical, optical, magnetic, and chemical properties that cannot be observed in their bulk counterparts. The synthesis of NPs (i.e., crystalline particles ranging in size from 1 to 100 nm) has been intensely studied in the past decades. Magnetic nanoparticles (MNPs) form a particularly attractive class of NPs and have found numerous applications such as in magnetic resonance imaging to visualize cancer, cardiovascular, neurological and other diseases. Other uses include drug targeting, tissue imaging, magnetic immobilization, hyperthermia, and magnetic resonance imaging. MNPs, due to their magnetic properties, can be easily separated from (often complex) matrices and manipulated by applying external magnetic field. Near-infrared to visible upconversion luminescent nanoparticles (UCLNPs) form another type of unusual nanoparticles. They are capable of emitting visible light upon NIR light excitation. Lanthanide-doped (Yb, Er) hexagonal NaYF₄ UCLNPs are the most efficient upconversion phosphors known up to now. The use of UCLNPs for in vitro imaging of cancer cells and in vivo imaging in tissues has been demonstrated. UCLNPs show great potential as a new class of luminophores for biological, biomedical, and sensor applications. We are reporting here on our first results on the combination of MNP and UCLNP technology within an ongoing project supported by the DFG and the FWF (Austria).