Abstract: Functional magnetic particles are formed by dissolving a mucopolysaccharide such as chitosan in acidified aqueous solution containing a mixture of ferrous chloride and ferric chloride. As the pH of the solution is raised magnetite is formed in situ in the solution by raising the pH. The dissolved chitosan is a polyelectrolyte and forms micelles surrounding the granules at pH of 8-9. The chitosan precipitates on the granules to form microspheres containing the magnetic granules.On addition of the microspheres to waste aqueous streams containing dissolved ions, the hydroxyl and amine functionality of the chitosan forms chelates binding heavy metal cations such as lead, copper, and mercury and the chelates in turn bind anions such as nitrate, fluoride, phosphate and borate.