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Ti nanoparticles were produced using a cluster-deposition method. Ti:TiO core-shell structures were fabricated by partially oxidizing the surface of the Ti nanoparticles produced by a cluster-deposition system via multistep annealing at 250 °C in oxygen. X-ray diffraction and transmission-electron microscopy studies reveal an increase in the thickness of the TiO shell with increasing annealing time. The magnetic moment and the coercivity of the core-shell nanoparticles increase with the TiO shell thickness, which is consistent with homogenous bulk defects in TiO. The core-shell nanoparticles display an abnormal hysteresis loop, which probably reflects a combination of antiferromagnetic exchange and magnetocrystalline anisotropy.