Herein, we introduce a novel strategy for the synthesis of Eu³⁺ doped α-sodium gadolinium fluoride (α-NaGd_0.88F₄:Eu_0.12³⁺) based luminomagnetic nanophosphors using a hydrothermal route. The synthesized nanophosphor has exceptional luminescent and paramagnetic properties in a single host lattice, which is highly desirable for biomedical applications. This highly luminescent nanophosphor with an average particle size ∼5 ± 3 nm enables high-contrast fluorescent imaging with decreased light scattering. In vitro cellular uptake is shown by fluorescent microscopy that envisages the characteristic hypersensitive red emission of Eu³⁺ doped α-sodium gadolinium fluoride centered at 608 nm (⁵D₀–⁷F₂) upon 465 nm excitation wavelength. No apparent cytotoxicity is observed. Furthermore, time-resolved emission spectroscopy and SQUID magnetic measurements successfully demonstrate a photoluminescence decay time of microseconds and an enhanced paramagnetic behavior, which holds promise for the application of nanophosphors in biomedical studies. Hence, the obtained results strongly suggest that this nanophosphor could be potentially used as a bimodal nanoprobe for high-contrast in vitro bioimaging of HeLa cells and external magnetic field tracking applications of luminomagnetic nanophosphors using permanent magnet.