Methods to synthesize magnetic Fe 3O 4 nanoparticles and to modify the nanoparticle surface are presented in this paper. In these methods, Fe 3O 4 nanoparticles were prepared by co-precipitation, and the aging of nanoparticles was improved by applied magnetic field. The obtained nanoparticles were characterized by Fourier transform infrared spectroscopy (FT-IR), scanning electron microscopy (SEM), X-ray powder diffraction (XRD), and vibrating sample magnetometer (VSM). Thereafter, to enhance the compatibility between nanoparticles and water, an effective surface modification method was developed by grafting acrylic acid onto the nanoparticle surface. FT-IR, XRD, transmission electron microscopy (TEM), and thermogravimetry (TG) were used to characterize the resultant sample. The testing results indicated that the polyacrylic acid chains have been covalently bonded to the surface of magnetic Fe 3O 4 nanoparticles. The effects of initiator dosage, monomer concentration, and reaction temperature on the characteristics of surface-modified Fe 3O 4 nanoparticles were investigated. Moreover, the Fe 3O 4-g-PAA hybrid nanoparticles were dispersed in water to form ferrofluids (FFs). The obtained FFs were characterized by UV–vis spectrophotometer, Gouy magnetic balance and laser particle-size analyzer. The testing results showed that the high-concentration FF had excellent stability, with high susceptibility and high saturation magnetization. The rheological properties of the FFs were also investigated using a rotating rheometer.