Recently, magnetic platforms have been widely investigated in diagnostic, therapeutic and research applications due to certain properties, such as cell and tissue tracking and imaging, thermal therapy and being dirigible. In this study, the incorporation of magnetic nanoparticles (MNPs) in nanofibers has been proposed to combine the advantages of both nanofibers and MNPs to induce neural differentiation of mesenchymal stem cells. Magnetic poly (lactic-co-glycolic acid) nanofibers (containing 0%, 5% and 10% SPION) were fabricated and utilized as the matrix for the differentiation of mesenchymal stem cells (MSCs). Morphological, magnetic and mechanical properties were analyzed using FESEM, VSM and tensile test, respectively. The expression of neural markers (TUJ-1, NSE, MAP-2) was assessed quantitative and qualitatively utilizing RT-PCR and immunocytochemistry. Results confirmed the incorporation of MNPs in nanofibrous scaffold, presenting a saturation magnetization of 9.73 emu g−1. Also, with increase in magnetic particle concentration (0%–10%), tensile strength increased from 4.08 to 5.85 MPa, whereas the percentage of elongation decreased. TUJ-1 expression was 3.8 and 1.8 fold for 10% and 5% magnetic scaffold (versus non-magnetic scaffold) respectively, and the expression of NSE was 6.3 and 1.2-fold for 10% and 5%, respectively. Consequently, it seems that incorporation of magnetic biomaterial can promote the neural differentiation of MSCs, during which the augmentation of super paramagnetic iron oxide concentration from 0% to 10% accelerates the neural differentiation process.