Stable suspensions of superparamagnetic cobalt nanoparticles have been prepared in poly(dimethysiloxane) (PDMS) carrier fluids in the presence of poly[dimethylsiloxane-b-(3-cyanopropyl)methylsiloxane-b-dimethylsiloxane] (PDMS–PCPMS–PDMS) triblock copolymers as steric stabilizers. A series of the polysiloxane triblock copolymers with systematically varied molecular weights were prepared via anionic polymerization using LiOH as an initiator. These copolymers formed micelles in toluene and served as ‘nanoreactors’ for thermal decomposition of the Co₂(CO)₈ precursor. The nitrile groups on the PCPMS central blocks are thought to adsorb onto the particle surface, while the PDMS endblocks protrude into the reaction medium to provide steric stability. The particle size can be controlled by adjusting the cobalt to copolymer ratio. TEM shows non-aggregated cobalt nanoparticles with narrow size distributions which are evenly surrounded with copolymer sheaths. However, some degree of surface oxidation was observed over time, resulting in a decrease in magnetic susceptibility.