The magnetic cobalt ferrite nanoparticles (CoFe2O4) were synthesized by sol-gel combustion technique and encapsulated with polyethylene glycol (PEG). The phase formation and crystalline nature were confirmed by X-ray diffraction (XRD) and Fourier Transform Infrared Spectroscopy (FTIR). The microstructure and elemental composition were characterized using Scanning Electron Microscopy (SEM). Magnetic characteristics of the synthesized sample were studied at room temperature using Vibrating Sample Magnetometer (VSM) and its low coercivity value indicates that these nanoparticles are near the superparamagnetic limit. Hyperthermic behavior and cell biocompatibility characteristics with human leucocyte culture were analyzed and results signify that synthesized cobalt ferrite (CoFe2O4) nanoparticles encapsulated with Polyethylene glycol (PEG) are one of the potential candidates for hyperthermia, targeted drug delivery and various other biomedical applications. © 2019 Elsevier Ltd. All rights reserved.