Given the superior soft tissue contrasts obtained by MRI and the long residence times of magnetic nanoparticles (MNPs) in soft tissues, MNP-based theranostic systems are being developed for simultaneous imaging and treatment. However, development of such theranostic nanoformulations presents significant challenges of balancing the therapeutic and diagnostic functionalities in order to achieve optimum effect from both. Here we developed a simple theranostic nanoformulation based on magnetic nanoclusters (MNCs) stabilized by a bisphosphonate-modified poly(glutamic acid)-b-(ethylene glycol) block copolymer and complexed with cisplatin. The MNCs were decorated with luteinizing hormone releasing hormone (LHRH) to target LHRH receptors (LHRHr) overexpressed in ovarian cancer cells. The targeted MNCs significantly improved the uptake of the drug in cancer cells and decreased its IC50 compared to the nontargeted formulations. Also, the enhanced LHRHr-mediated uptake of the targeted MNCs resulted in enhancement in the T2-weighted negative contrast in cellular phantom gels. Taken together, the LHRH-conjugated MNCs show good potential as ovarian cancer theranostics.