Ferromagnetic Co nanoparticles with diameters of about 40-400 nm are synthesized by electroless deposition in boiling propylene glycol. The Co particle size is decreased to a certain degree by varying the concentration of starting materials and by adding nucleating agents. The electrochemical behavior of propylene glycol is investigated by in situ measurements of mixed potential to understand the formation of Co nanoparticles in polyol systems. The mixed potential decreases with an increase in temperature and in the presence of NaOH, which suggests the faster decomposition of propylene glycol. It also shifts abruptly to a more negative value when nucleating agents are added. This indicates that nucleating agents catalyze both the oxidation reaction of propylene glycol and the reduction reaction of Co(II) species, as well as aid in the formation of Co nanoparticles as heterogeneous nucleation sites.