A magnetic perovskite-spinel oxide nanocomposite synthesized through a sol–gel self-combustion process is used for the first time as an adsorbent to remove toxic heavy metals (i.e., Pb2+). The synthesized LaFeO3:CoFe2O4 ((LFO)1:(CFO)x) (x = 0.11–0.87) nanocomposites possess good stability, abundant oxygenated active binding sites, and unique structural features, making them suitable for removing divalent Pb2+ ions. Scanning electron microscopy, X-ray diffraction, BET surface area, magnetization measurements, zeta-potential analyses, and X-ray photoelectron spectroscopy were used to analyze the nanocomposites, and their structural changes after Pb2+ ions adsorption. Batch tests confirmed that (LFO)1:(CFO)x efficiently removes Pb2+ from water with a maximum adsorption capacity of 105.96 mg/g. The detailed quantitative study indicates that the interaction of hydroxyl groups with Pb2+ ions occurs through electrostatic interactions and complex formation. We also demonstrate a new ring-magnetic separator system that allows magnetic separation of the toxic ions at a higher speed compared to traditional block magnets. The unique structure, high porosity, large specific surface area, and oxygenated functional groups of (LFO)1:(CFO)x nanocomposites make them promising materials for removal of heavy metal ions and possibly other environmental pollutants. This study provides a new approach to preparing nanocomposites of magnetic spinel ferrites with perovskite oxides for environmental applications.