The synthesis, structural and optical characterization, and application of superparamagnetic and water-dispersed Fe3O4-Au core-shell nanoparticles for surface enhanced Raman scattering (SERS) is reported. The structure of the nanoparticles was determined by scanning transmission electron microscopy (STEM) and high-resolution transmission electron microscopy (HRTEM). STEM images of the Fe3O4-Au core-shell nanoparticles reveal an average diameter of 120 nm and a high degree of surface roughness. The nanoparticles, which display superparamagnetic properties due to the core Fe3O4 material, exhibit a visible surface plasmon resonance (SPR) peaked at 580 nm due to the outer gold shell. The nanoparticles are used as a substrate for surface enhanced Raman scattering (SERS) with rhodamine 6G (R6G) as a Raman reporter molecule. The SERS enhancement factor is estimated to be on the order of 106, which is ∼ 2 times larger than that of conventional gold nanoparticles (AuNPs) under similar conditions. Significantly, magnetically-induced aggregation of the Fe3O4-Au core-shell nanoparticles substantially enhanced SERS activity compared to non-magnetically-aggregated Fe3O4-Au nanoparticles. This is attributed to both increased scattering from the aggregates as well as “hot spots” due to more junction sites in the magnetically-induced aggregates. The magnetic properties of the Fe3O4 core, coupled with the optical properties of the Au shell, make the Fe3O4-Au nanoparticles unique for various potential applications including biological sensing and therapy.