Cd1-xMnxS quantum dots (QDs) of 4.5 nm average size with various compositions, from x = 0.001 to x = 0.15, have been synthesized by using aqueous solution precipitation. Diluted magnetic semiconductor (DMS) quantum dots are characterized by optical and structural techniques and electron paramagnetic resonance (EPR). Optical properties of DMS QDs are influenced by the presence of Mn2+ ions compared to CdS QDs. In the EPR spectra of Cd1-xMnxS QDs two structures are identified, a hyperfine structure and a broad EPR line. The hyperfine structure originating from the isolated Mn2+ ions is observed for all the manganese concentrations in the nanoparticles.