The synthesis of clay composites modified with magnetite and Co ferrite magnetic nanoparticles is described. The synthetic method relies on the adsorption of colloidal magnetite or Co ferrite particles onto the external surfaces of a Na-saturated clay mineral to give magnetic clay composites that can be converted easily, through ion exchange reactions, to valuable clay derivatives, e.g. organoclays, which maintain the magnetic properties of the parent composite. The magnetic solids were characterized by XRD, EPR, Mössbauer, magnetic measurement and TEM techniques.