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Current developments in nanotechnology offer new tools to the design of nanometric heat-generating ‘foci’ that can be activated remotely by an external alternating magnetic field. These nanometric heat sources may serve for therapeutic hyperthermia alone or combined with other therapeutic modalities, such as drug delivery or gene therapy. Activable therapeutic tools at the nanoscale fulfill the requirements of future medicine in terms of spatial targeting and temporal control of therapy. The present review discusses fundamental aspects regarding the design of magnetic nanoparticles with optimized properties, by unraveling physical mechanisms that govern heating power in biological media. Towards therapy, achievements and promises of magnetic nanoparticles for cancer-localized hyperthermia, targeting strategies and multivalent functionalities are exposed.