Compact nanostructures with highly integrated functionalities are of considerable current interest to drug delivery, multimodality imaging, and electronic devices. A key challenge, however, is how to combine individual components together without interfering or sacrificing their original electronic and optical properties. Here, we demonstrate a new class of nanocomposites with spatially separated functionalities. We further demonstrate magnetic field modulated imaging and an innovative application of this technology in cancer cell treatment, magnetolytic therapy, based on magnetically controlled mechanical damage to cell membranes.