The erythrocytes were loaded with ibuprofen and magnetite (ferrofluids) using the pre-swell technique. Various process variables including drug concentration, magnetite concentration, sonication of ferrofluids that could affect the loading of drug and magnetite were optimized. The loaded erythrocytes were characterized for in vitro drug efflux, haemoglobin release, morphology, osmotic fragility, turbulence shock, in vitro magnetic responsiveness and percentage cell recovery. In optimum concentration erythrocytes could tolerate ibuprofen as no appreciable detrimental effects were noticed on cell morphology, osmotic fragility, and turbulence shock, when compared with normal erythrocytes. However, magnetite showed some detrimental effect on erythrocytes. A drug release profile from the cellular system was observed to follow approximate zero-order kinetics. The loaded cells effectively responded for an external magnetic field of 8.0 KOe.