Calcium alginate beads were synthesized through a cross-linking reaction between sodium alginate and calcium solutions. The effect of calcium concentration on the bead strength and chemical stability were investigated. Beads produced from a 0.5M Ca solution were robust and resistant to chemical dissolution. Co-precipitated magnetite nanocrystals were functionalized with meso-2,3-dimercaptosuccinic acid and dispersed inside the beads to form a magnetic polymer nanocomposite. The resulting nanocomposite can be used as sorbent for toxic aqueous species because of the ionic exchange capabilities exhibited by the alginate matrix and its synergistic interaction with functionalized magnetite nanoparticles. X-ray diffraction and Fourier Transform infrared spectroscopy confirmed the formation of the expected structures in pure beads and the corresponding nanocomposites. The magnetization of the nanocomposite was tuned by controlling the weight load of the magnetite phase within the alginate matrix.