Stable colloidal dispersions of cobalt nanoparticles were prepared by refluxing toluene solutions of dicobalt octacarbonyl in the presence of poly(dimethylsiloxane-b-(methylvinylsiloxane-co-methyl(2-trimethoxysilethyl)siloxane)) (PDMS-b-(PMVS-co-PMTMS)) dispersion stabilizers. The nanoparticles coated with the polysiloxane copolymer were subsequently heated at 600 or 700 degrees C with the goal of forming siliceous shells on the cobalt surfaces to protect them from oxidation. The thermolysis processes at 600 and 700 degrees C produced increases in the cobalt specific saturation magnetizations (sigma(s),) from 48 to 141 and 146 emu g(-1) of cobalt respectively. The siliceous coatings provided oxidative protection under ambient conditions for long periods. However, mechanically grinding the thermally treated nanoparticles led to decreases in sigma(s) upon aging in air. Particle size analyses indicated an increase in average particle size in the materials heated at 600 degrees C, but the materials that were heated at 700 degrees C retained their small nanoparticle sizes. Electron diffraction and X-ray diffraction confirmed that the heat-treated cobalt nanoparticles were predominantly in the face-centered cubic phase, while the materials that had not been heated at the elevated temperatures were only weakly crystalline. Hence, the increases in sigma(s) from the preheat-treated to the heat-treated materials were attributed to an improvement in particle crystallinity, combined with less oxidation due to partial protection by a siliceous shell.