There are several emerging diagnostic and therapeutic applications of magnetic nanoparticles (mNPs) in medicine. This study examines the potential for developing an mNP imager that meets these emerging clinical needs with a low cost imaging solution that uses arrays of digitally controlled drive coils in a multiple-frequency, continuous-wave operating mode and compensated fluxgate magnetometers. The design approach is described and a mathematical model is developed to support measurement and imaging. A prototype is used to demonstrate active compensation of up to 185 times the primary applied magnetic field, depth sensitivity up to 2.5 cm (p < 0.01), and linearity over five dilutions (R2 > 0.98, p < 0.001). System frequency responses show distinguishable readouts for iron oxide mNPs with single magnetic domain core diameters of 10 and 40 nm, and multi-domain mNPs with a hydrodynamic diameter of 100 nm. Tomographic images show a contrast-to-noise ratio of 23 for 0.5 ml of 12.5 mg Fe ml−1 mNPs at 1 cm depth. A demonstration involving the injection of mNPs into pork sausage shows the potential for use in biological systems. These results indicate that the proposed mNP imaging approach can potentially be extended to a larger array system with higher-resolution.