Paramagnetic polyethylene glycol (PEG) functionalized gadolinium oxide (Gd2O3@PEG) nanoparticles were synthesized by a facile thermal decomposition of gadolinium acetate hydrate (Gd (CH3CO2)(3)center dot XH2O) precursors in PEG-1000. PEG-1000 was used as a solvent, and as a size reducing and functionalizing agent. The advantages of the present method are that it is simple and relatively fast, and it only needs a small amount of reagents. The resulting nanoparticles were characterized by X-ray Diffraction (XRD), Fourier Transform Infrared Spectroscopy (FTIR), Scanning Electron Microscopy (SEM), Transmission Electron Microscopy (TEM) and Energy Dispersive X-ray Spectroscopy (EDX). From the XRD data, the average crystallite size, t, of the Gd2O3@PEG nanoparticles was calculated to be about 5.4, 3.8, and 3.1 nm at decomposition temperatures of 260 degrees C, 280 degrees C and 300 degrees C respectively. The SEM images revealed that the synthesized nanoparticles had a homogenous spherical shape while the coated nanoparticle diameters were about 178 nm at 260 degrees C. Synthesis at higher temperatures tended to cause agglomeration. FTIR analysis showed that the oxidation of PEG is linked to the Gd2O3 surface. Magnetization was investigated using a Vibrating Sample Magnetometer (VSM). The magnetization vs. magnetic field (M-H) curve, measured at 300 K, showed that the Gd2O3@PEG nanoparticles exhibit characteristic paramagnetic behavior. We confirmed that the dispersibility and functionalization behavior of the PEG was successfully transferred to the Gd2O3 nanoparticles. (C) 2016 The Society of Powder Technology Japan. Published by Elsevier B.V. and The Society of Powder Technology Japan. All rights reserved.