In recent years, various new types of magnetic materials have emerged, especially in the field of nanotechnology. The application of material composite technology has formed a new type of dual-phase composite magnetic material. Under the control of an external magnetic field, the material can achieve functional conversion between the hard magnetic phase and the soft magnetic phase, with magnetic permeability, non-magnetic permeability, and excitation ability. In this paper, it is proposed to use this material as the basic material for the magnetic state control of the reactor core, break through the bondage of the traditional reactor core to the performance of the controllable reactor, and innovatively form a new type of reactor structure. By adding a detection and control system, according to the working state of the power grid, the function conversion of the nano adjustable magnetic material is effectively adjusted to realize the automatic adjustment of the magnetic state of the reactor. Firstly, the preparation and material properties of dual-phase composite magnetic materials were studied. The design and preparation process from magnetic powder to bulk magnet were given, and the magnetic properties were measured. Secondly, a new 380 V/100 kVar magnetically controlled reactor was designed by using dual-phase composite magnetic material to form a composite core of magnetically controlled reactor on silicon steel sheet. The simulation analysis of electromagnetic characteristics and volt-ampere characteristics was carried out to verify the correctness of the proposed scheme.