Chemotherapy drug Doxorubicin and MRI imaging agent Iron Oxide were encapsulated in dual functional nanoparticles which is compose of PEG-Foliate acid polymers. The particle size was about 45 nm with a mono-dispersion measured by zeta-sizer instrument. The contrast of images in liver was enhanced after injection Nanoparticles via rabbit ear vein. PEG-FA coated Iron Oxide nanoparticles can selectively target to tumor site and effectively inhibit tumor growth which is subcutaneously bearing A2780 Overran cancer cells. It is feasible for cancer treatment with MRI imaging and chemotherapy simultaneously in vivo by injection dual functional nanoparticles.