FePt magnetic nanoparticles are an important candidate material for many future magnetic applications. FePt exists as two main phases, that is, a disordered face-centered cubic (fcc) structure, which is generally prepared by chemical methods at low temperatures, and the high-temperature chemically ordered face-centered tetragonal (fct) structure. The fee FePt, with low coercivity but associated with superparamagnetic properties, may find applications as a magnetic fluid or as a nanoscale carrier for chemical or biochemical species in biomedical areas, while fct FePt is proposed for use in ultrahigh-density magnetic recording applications. However, for both of these applications an enhancement of the intrinsically weak magnetic properties, the avoidance of magnetic interferences from neighbor particles, and the improved stability of the small magnetic body remain key practical issues. We report a simple synthetic method for producing FePt nanoparticles that involves hydrothermal treatment of Fe and Pt precursors in glucose followed by calcination at 900 degrees C. This new method produces thermally stable spheroidal graphite nanoparticles (large and fullerene-like) that encapsulate or decorate FePt particles of ca. 5 nm with no severe macroscopic particle coalescence. Also, a low coercivity of the material is recorded; indicative of small magnetic interference from neighboring carbon-coated particles. Thus, this simple synthetic method involves the use of a more environmentally acceptable glucose/aqueous phase to offer a protective coating for FePt nanoparticles. It is also believed that such a synthetic protocol can be readily extended to the preparation of other graphite-coated magnetic iron alloys of controlled size, stoichiometry, and physical properties.