Hematite (α-Fe2O3) nanoparticles and hematite nanoparticles coated with polyvinylpyrrolidone (PVP) are synthesized chemically by co-precipitation. Prolysis and microemulsion methods respectively. An average size of nanoparticles (both coated and uncoated) was found by the broadening of the X-ray diraction peaks using Scherrer's formula. It was found that coating reduced particle sizes. The attachment of the polymer on the surface of particles was conrmed by the Fourier transform infrared spectroscopy and thermogravimetric analysis. Optical ultraviolet/visible reectance test also indicated the presence of PVP in coated nanohematites. In magnetic studies, it was observed that coating does not change main magnetic character of the α-Fe2O3 nanoparticles however it reduces DC magnetization (as a function of applied eld and temperature) to a considerable amount. Moreover it was observed that after coating Morin transition temperature TM and its width ∆TM shifts to lower values, which is another indication of size reduction.