The use of nanotechnology is growing rapidly, with potential applications ranging from production to electronics to medicine. Nanotechnology has been proven to have a great impact on biomedicine through its applications in tissue engineering, cancer therapy, hyperthermia, and other drug delivery purposes. Nanomaterials can be fabricated and manipulated to suit the requirements for a particular function. Drug delivery through magnetic nanoparticles is being used for site-specific and controlled drug-release purposes. Magnetic drug transport involves encapsulating a drug in a magnetic nanosphere and administering it intravenously to deliver it to a particular organ or a receptor for therapeutic purposes. Nanotechnology-based drug delivery maximizes patient compliance and targeting efficiency, and thus reduces the toxicity of the drug to normal cells. Nanotechnologies that are being used in medical applications for diagnostics, as drug carriers, and for prosthesis and implants have raised interest and concern about their biocompatibility and toxicity. It has been shown that nanomaterials that come in contact with the human body can affect the central nervous system and cause inflammatory responses in the lungs, liver, spleen, etc. In this research, emphasis was placed on determining the toxicity of nanocomposite spheres made from two magnetic nanoparticles—nickel ferrite and cobalt ferrite. These magnetic nanoparticles were fabricated using a sol-gel process and then used to fabricate nanocomposite spheres using PLGA as a polymer and an oil-in-oil emulsion/solvent evaporation technique. Different samples were made with different nanoparticle compositions, and these samples were tested for cytotoxicity using a standard colorimetric test using MTT assay. Viability tests were conducted on these cells to determine the toxicity by varying the composition and concentration of the nanoparticle, and then comparing the two different nanomaterials.