Ligand-stabilized nanoparticles possess size- and shape-dependent physical properties, and the ligand monolayers facilitate self-assembly.  Several approaches for synthesizing, assembling, and transforming nanoparticles that result in novel optical and magnetic properties will be discussed:  (1) A new method for tailoring the size and shape of Au nanorods gives control over their optical properties.  (2) Electrospinning of aligned polymer nano/microfibers from Au nanorod/polymer solutions causes macroscale alignment of the nanorods, which imparts anisotropic optical properties.  (3) Magnetic field-directed self-assembly of magnetic nanoparticles enables the synthesis of polymer composites containing embedded nanoparticle chains.  (4) Nanostructural transformations accompanying the conversion of Ni nanoparticles into NiO and Ni_xP_y provide insight into the fabrication of heterostructured nanomaterials.  (5) Deposition of thin Al₂O₃ layers onto monolayers of FePt nanoparticles promotes their sinter-free conversion from an alloy phase into intermetallics for magnetic recording.