Iron/iron carbide core and carbon shell nanoparticles with improved magnetic properties were successfully synthesized by laser pyrolysis. As iron and carbon precursors, iron pentacarbonyl and pure or argon-diluted acetylene/ethylene mixtures, respectively, were used. The aim of the present optimization is the improvement of the magnetic properties of the nanomaterials by the increase of the iron percent in powders simultaneously to the maintaining of the protective character of the carbon coverage of nanoparticles. The chemical content and the crystalline structure were monitored by EDX, XRD and TEM techniques. In the first study, the content of acetylene as carbon source was diminished from 75% to 0%. Consequently the percent iron increased from 10 at.% to 28 at.% while oxygen remained relatively constant (around 5 at.%). In the second step, only diluted ethylene was used (maximum 87.5 vol.% Ar). In this case, an increase of iron to 46 at.% is observed. An optimum 50% carbon source dilution was found. Above this value, the carbon content increases and below it, superficial oxidation increases through the diminishing of the carbon shell. The magnetic properties and the Fe phase composition of the Fe-C samples were analyzed by temperature dependent Mossbauer spectroscopy. (C) 2010 Elsevier B.V. All rights reserved.