Biocompatible magnetic nanoparticles could be selected for smart hyperthermia. The magnetic particles should have a narrow size distribution and surface modified with biocompatible materials. In this study, the effects of surface modification in nano-magnetite were evaluated by characterization and cell response. The synthesized magnetite exhibited a mean diameter of 10.3 ± 2.6 nm. The temperature change under alternating magnetic field and saturation magnetization (Ms) was ΔT = 23 °C, Ms = 25.6 emu/g and ΔT = 12 °C, Ms = 16.4 emu/g in chitosan and starch coated magnetite, respectively. In cytotoxic test, the viability of L929 cells was the greatest value 93.67% in chitosan coated magnetic particles. The exothermic and biocompatible chitosan coated magnetite will be selected for optimized hyperthermic thermoseed.