Ultrafine alpha-Fe2O3 nanoparticles with an extremely narrow distribution were prepared by microwave heating. The average diameter of the particles was approximately 7 nm. These nanoparticles were extremely stable in the colloidal state, even in the absence of stabilizers. The obtained alpha-Fe2O3 nanoparticles worked as a rechargeable electrode material. An initial discharge capacity exceeded 400 mA It g(-1) (cut-off voltage: 1.0 V).