Nanoparticles have demonstrated noteworthy advancements in the management of various complex medical conditions, particularly cancer. In any case, these particles still harbor the potential to improve medicate conveyance to challenging, hard-to-reach loci. The interactions that occur between nanoparticles and red blood cells during their journey throughout the human body, despite exposure to blood, are still not fully understood. Assessment of the ability of nanoparticles to integrate with blood, characterized as nanoparticle compatibility, has been consistently overlooked and undervalued in its import. This review article investigates the effect of nanoparticles on red blood cells, while examining the compatibility of nanoparticles through the angle of hemolysis. This article discusses the main roles of erythrocytes and also provides an informed interpretation of several mechanisms involved in the interaction of nanoparticles and erythrocytes. Throughout the review, significant emphasis is attributed to the investigation of hemocompatibility studies concerning newly designed nanoparticles to promote their successful translation into clinical application. This review article examines the compatibility of magnetic nanoparticles in various fields, including regenerative medicine, cancer therapy, bioimaging, and drug delivery. Our results show that the chemical composition of the nanoparticle surface is a determining factor in hemocompatibility performance and interaction with blood cells. The surface properties of nanoparticles, namely surface charge, geometry, porosity, and surface functionalities of polymers or specific functional groups, represent key determinants of hemocompatibility.