Hetero-nanoparticles represent an important family of composite nanomaterials that in the past years are attracting ever-growing interest. Here, we report a new strategy for the synthesis of water dispersible cobalt ferrite nano particles (CoxFe3-xO4 NPs) decorated with ultrasmall (2-3 nm). gold nanoparticles (Au NPs). The synthetic procedure is based on the use of 2,3-meso-dimercaptosuccinic acid (DMSA), which plays a double role. First, it transfers cobalt ferrite NPs from the organic phase to aqueous media. Second, the DMSA reductive power promotes the in situ nucleation of gold NPs in proximity of the magnetic NP surface. Following this procedure, we achieved a water dispersible nanosystem (CoxFe3-xO4-DMSA-Au NPs) which combines the cobalt ferrite magnetic properties with the catalytic features of ultrasmall Au NPs. We showed that CoxFe3-xO4-DMSA-Au NPs act as an efficient nanocatalyst to reduce 4-nitrophenol to 4-aminophenol and that they can be magnetically recovered and recycled. It is noteworthy that such nanosystem is more catalytically active than Au NPs with equal size. Finally, a complete structural and chemical characterization of the hetero-NPs is provided.