The effective capture and storage of radioactive iodine is of importance for nuclear waste storage during nuclear power station accidents. Here we report Fe3O4@PPy powder containing ∼12nm magnetite (Fe3O4) nanoparticles encapsulated in the polypyrrole (PPy) matrix. It shows 1627mg/g uptake of iodine dissolved in water, within 2h at room temperature. Fe3O4@PPy is ferromagnetic in nature and can be separated from water using external magnetic field. The nitrogen gas sweeping test at 30°C shows release of 2% iodine from iodine adsorbed Fe3O4@PPy, revealing stable storage of iodine for a moderate period. The iodine-adsorbed magnetic powder can be regenerated by washing with ethanol. The XPS spectrum of iodine adsorbed Fe3O4@PPy confirmed the presence of polyiodides (I3− and I5−) bound to the PPy surface. This excellent iodine capture and storage from iodine contaminated water is an environment friendly, inexpensive and large scale method.