The conversion of electromagnetic energy into heat by nanoparticles has the potential to be a powerful, non-invasive technique for biotechnology applications such as drug release(1-3), disease treatment(4-6) and remote control of single cell functions(7-9), but poor conversion efficiencies have hindered practical applications so far(10,11). In this Letter, we demonstrate a significant increase in the efficiency of magnetic thermal induction by nanoparticles. We take advantage of the exchange coupling between a magnetically hard core and magnetically soft shell to tune the magnetic properties of the nanoparticle and maximize the specific loss power, which is a gauge of the conversion efficiency. The optimized core-shell magnetic nanoparticles have specific loss power values that are an order of magnitude larger than conventional iron-oxide nanoparticles. We also perform an antitumour study in mice, and find that the therapeutic efficacy of these nanoparticles is superior to that of a common anticancer drug.