This study attempts to synthesize magnetite nanoparticles from a high purity natural iron oxide ore found in Panvila, Sri Lanka, following a novel top-down approach. Powder X-Ray diffraction, elemental analysis, and chemical analysis data confirmed the ore to be exclusively magnetite with Fe2+ : Fe3+ ratio of 1 : 2. Surface modified magnetite nanoparticles were synthesized by destructuring of this ore using a top-down approach in the presence of oleic acid. These oleic acid coated nanoparticles were further dispersed in ethanol resulting in stable nanomagnetite dispersion. Interestingly, the nanoparticles demonstrated a spherical morphology with a particle size ranging from 20 to 50 nm. Magnetic force microscopic data was used to confirm the topography of the nanoparticles and to study the magnetic domain structure.