Cancer gene therapy requires a safe and effective gene delivery system. Polymer- and lipid-coated magnetic nanocrystals have been used to deliver silencing RNA, but synthesizing these magnetic vectors is difficult. Here, we show that a new nanoparticle formulation can be magnetically guided to deliver and silence genes in cells and tumours in mice. This formulation, termed LipoMag, consists of an oleic acid-coated magnetic nanocrystal core and a cationic lipid shell. When compared with the commercially available PolyMag formulation, LipoMag displayed more efficient gene silencing in 9 of 13 cell lines, and better anti-tumour effects when systemically administered to mice bearing gastric tumours. By delivering an optimized sequence of a silencing RNA that targets the epidermal growth factor receptor of tumour vessels, the intended therapeutic benefit was achieved with no evident adverse immune reaction or untoward side effects.