Stem cells have tremendous applications in the field of regenerative medicine and tissue engineering. These are pioneering fields that aim to create new treatments for disease that currently have limited therapies or cures. A particularly popular avenue of research has been the regeneration of bone and cartilage to combat various orthopaedic diseases. Magnetic nanoparticles (MNPs) have been applied to aid the development and translation of these therapies from research to the clinic. This review highlights contemporary research for the applications of iron-oxide-based MNPs for the therapeutic implementation of stem cells in orthopaedics. These MNPs comprise of an iron oxide core, coated with a choice of biological polymers that can facilitate the uptake of MNPs by cells through improving endocytic activity. The combined use of these oxides and the biological polymer coatings meet biological requirements, effectively encouraging the use of MNPs in regenerative medicine. The association of MNPs with stem cells can be achieved via the process of endocytosis resulting in the internalisation of these particles or the attachment to cell surface receptors. This allows for the investigation of migratory patterns through various tracking studies, the targeting of particle-labelled cells to desired locations via the application of an external magnetic field and, finally, for activation stem cells to initiate various cellular responses to induce the differentiation. Characterisation of cell localisation and associated tissue regeneration can therefore be enhanced, particularly for in vivo applications. MNPs have been shown to have the potential to stimulate differentiation of stem cells for orthopaedic applications, without limiting proliferation. However, careful consideration of the use of active agents associated with the MNP is suggested, for differentiation towards specific lineages. This review aims to broaden the knowledge of current applications, paving the way to translate the in vitro and in vivo work into further orthopaedic clinical studies.