Imidazole based amphiphilic ionic liquids (ILs) were used as surfactants in miniemulsion polymerization (MEP) of styrene using a free radical process as well as reversible addition-fragmentation chain transfer (RAFT). Monodisperse polystyrene (PS) nanoparticles were obtained, demonstrating the efficiency of the amphiphilic IL as surfactant in MEP. IL stabilized miniemulsion was furthermore used to prepare polystyrene based magnetic nanoparticles (MNP). A large increase of the possible MNP content associated with very good colloidal stability was achieved using IL stabilized RAFT mediated MEP where a carboxyl functionalized chain transfer agent (CTA) was applied, allowing interaction with the MNP surface. The molecular weight and dispersity index of polystyrene, the content of MNP, and the morphologies of the hybrid nanoparticles were controlled by proper optimization of the concentration of initiator and CTA. The materials have been analyzed by NMR, GPC, DLS, SEM, TEM, and TGA. Finally, the magnetic properties of the materials were determined by vibrating sample magnetometer (VSM) analysis.