We are reporting the core-shell structured iron/graphite nanoparticles formed by annealing of a nanopowder. The original Fe-C-N based nanopowder has been synthesized by the laser pyrolysis of gas phase reactants. TEM, XRD, Raman spectroscopy, Mossbauer spectroscopy and magnetic measurements were used for its characterization. Nanopowder was heated up to 800 degrees C at similar to 1 Pa vacuum. Presence of iron nanoparticles with the mean diameter of 40 nm in the annealed state of the nanopowder was confirmed from the width of alpha-Fe X-ray diffraction lines and their core-shell structure was observed under TEM.