In this work, the catalytic degradation of C.I. Reactive Red 120 (RR120) using magnetic nanoparticles of cobalt-iron oxide in the presence of hydrogen peroxide was studied. The magnetic nanoparticles of cobalt-iron oxide have been prepared by modified sol-gel method and have been characterized by XRD, TEM and VSM methods. The prepared nanoparticles were nanocrystalline pure single-phase and with particle sizes of 16-21 nm. Values of saturation magnetization, remanent magnetization and coersivity were found to be 68 emu/g, 31 emu/g and 1824 Oe, respectively.The magnetic nanoparticles of cobalt-iron oxide showed its catalytic effect for dye degradation over a wide range of pH=2-8 with a maximum effect at pH=2-3. The decolorization rate increased by increasing the amount of catalyst, the concentration of hydrogen peroxide and temperature. The optimal condition for complete decolorization of RR120 (50 ppm, 50 ml) was found to be 0.1 g/l of catalyst, 10 mM hydrogen peroxide at pH=3 and 75oC. The recovered nanoparticles of cobalt-iron oxide showed almost the same catalytic activity as the first time after 6 cycles of recovery and reuse.