Magnetite nanoparticles were prepared with starch as surfactant by ball milling for 30 h a toluene medium. The nanoparticles were synthesized with different amounts of surfactant addition (8-12 wt%) and the variation in their effective anisotropy and magnetic properties with surfactant content is investigated. The samples were characterized by X-ray diffraction, FT-IR, and scanning electron microscopy. Magnetic measurements were carried out using a vibrating sample magnetometer. The cytotoxicity of the magnetite nanoparticles coated with 12% starch was evaluated on L929 cell lines using MTT assay. The analysis of FT-IR spectrum reveals a new bond at 810 cm-1 in the sample coated with 9 wt% starch, but this is not observed in other samples. The particle size of this sample is higher, whereas the lattice strain, coercivity (Hc) and saturation magnetization (Ms) are less compared with other samples. As the size decreases, the Ms, Hc and magnetic effective anisotropy Keffof these samples increase. The increase in Ms with particle size reduction may be attributed to magnetic anisotropy, grain boundary effects, and changes in surface anisotropy caused by surfactant variation. © 2014 IEEE.