Breast cancer is the most common cancer in women. Even with advancing treatment techniques, breast cancer is still the cause of tens of thousands of death in the U.S. alone. Combined treatments including surgery, radio and chemotherapy are commonly implemented for breast cancer. However, the survival rate of metastatic breast cancer remains low, so new targeted therapy strategies are needed. In recent years, nanotechnology has opened a new route for targeted therapy of breast cancer. Nonetheless, some challenges still remain for nanoparticles (NPs) used in breast cancer treatments. After loaded with anticancer drugs, fluorophores and targeting ligands, NP drug delivery systems suffer from issues of size limit, stability, target cell internalization and biodegradability. Anti-human epidermal growth factor receptor 2 (HER2/neu) monoclonal antibody is a good targeting ligand for some breast cancer cells for two main reasons. Firstly, about 1/4 of breast cancer patients overexpress HER2/neu. Secondly, monoclonal antibodies have a better targeting effect than small molecule, protein and aptamer-based targeting ligands. However, the bulky size of the antibodies can change the desired physiochemical properties of NPs. Therefore, an anti-HER2/neu peptide, which is a small exocyclic peptide derived from the antibody, is utilized for targeting purposes. Moreover, paclitaxel (PTX) is a strong anticancer drug that can restrain mitotic spindle assembly and chromosome segregation, and in turn prevent breast cancer growth. Here we report anti-HER2/neu peptide-conjugated and PTX loaded iron oxide NPs (IONP-PTX-AHNP) that are small size, highly stable and biocompatible in biological medium for breast cancer treatment. Significantly, the IONP-PTX-AHNP showed targeted cell uptake into HER2/neu overexpressed breast cancer cells and PTX-mediated cancer cell death.