In this work, the encapsulation of magnetic nickel nanoparticles in polyacrylamide particles was performed via inverse miniemulsion polymerization. The dispersion of nickel nanoparticles was characterized in polar solvents including water, ethanol, and dimethyl sulfoxide using different stabilizers. The best results were obtained when the nonionic stabilizer poly(ethylene glycol) octadecyl ether (Brij 76) was used to stabilize the nickel nanoparticles in dimethyl sulfoxide. In addition, the block copolymer poly(ethylene‐co‐butylene)‐b‐poly(ethylene oxide) was used as a surfactant to create inverse miniemulsions while minimizing the coalescence of the miniemulsion droplets. Different types of salts such as zinc, nickel, and sodium nitrates were tested as lipophobes to retard Ostwald ripening. Transmission electron microscopy images of polyacrylamide/nickel particles synthesized with zinc and nickel salts as lipophobes indicate that nickel nanoparticles are embedded in the polyacrylamide matrix. Magnetization curves show that the saturation magnetization of polyacrylamide/nickel particles is only slightly below that of the pure nickel nanoparticles. © 2012 Wiley Periodicals, Inc. J. Appl. Polym. Sci., 2013