This review article is a description of the present status of magnetic drug delivery systems (DDS). These are colloidal dispersions of composite nanoparticles consisting of a (polymeric or inorganic) biocompatible matrix and magnetic units, and designed to load and release therapeutic drugs. The matrix, together perhaps with adsorbed polymers or polyelectrolytes, provides the DDS with additional colloidal stability and eventually control of the immune response, and the magnetic inclusions have the goal of providing magnetic guidance. The techniques used in the production of the particles are described. The large surface/volume ratio of the particles brings about a superlative importance of the interface aspects, which are depicted in some detail. Attention is also paid to the possibilities that magnetic DDS offer to be guided by magnetic fields, and to their fate upon entering in contact with the blood proteins and the tumor cells. A description of in vitro and in vivo biodistribution experiments helps in this description. The number of animal experiments performed using magnetic DDS is rather large, but results in humans are far from being sufficient in number, something easily understood. The hopes for improvement and the challenges that must be overcome are described in the closing section.