Unilamellar vesicles formed spontaneously by forming solutions of single-tailed cationic and anionic surfactants [cetyltrimethylammonium bromide (CTAB) and dodecylbenzenesulfonic acid (HDBS), respectively] have been used as reactors for the direct, room temperature synthesis of nanometer-sized magnetic particles within their internal cores, A micellar anionic surfactant solution was titrated slowly into a micellar cationic surfactant solution containing ferrous chloride, forming defect free unilamellar vesicles that contained the reactant ferrous ions, CTAB/HDBS molar ratios of 13/7 and 6/4 and ferrous chloride concentrations of 0.1 and 0.05 M were used. Extravesicular ferrous ions were replaced with sodium ions by passing this suspension through a gel permeation chromatography column saturated with isotonic sodium chloride solution. Addition of sodium hydroxide to the extravesicular region caused hydroxyl ions to permeate into the vesicles and react with the available ferrous ions to form the product. Powder X-ray diffraction of the particulate sample showed the intense peaks of magnetite or gamma-ferrite. Bragg peak broadening was characteristic of crystallites of roughly the same diameter as particles measured by transmission electron microscopy, indicating that each particle was monocrystalline. All of the intense peaks were distinctly asymmetric. Magnetization measurements showed that the particles were superparamagnetic. Using the Langevin function folded with the particle size distribution to model the magnetization of the sample in response to an applied magnetic field yielded "magnetic" diameter distributions that were consistently smaller than particle size distributions obtained from transmission electron microscopy. The magnetic size is consistent with the existence of a magnetically anomalous surface layer on each particle, as has been reported with other ferrites. The asymmetric diffraction peaks may be explained with a model that permits surface relaxation, and it is possible that the two phenomena are linked.