This study investigates synthesis and characterization of polyacrylamide (PAAm) hydrogels containing magnetic NiFe2O4 nanoparticles. Structural, electrical, and magnetic characterization of the gels have been performed with X-ray powder diffractometry, scanning electron microscopy, DC conductivity, magnetization and fluorescence spectroscopy techniques. Fluorescence and electrical measurements show that nanoparticles have got trapped in the gel so it cannot move through the gel even if the gel is swollen and the voltage is applied. It was observed that the presence of NiFe2O4 nanoparticles makes the gel more homogeneous. Magnetization measurements reveal that NiFe2O4 nanoparticles have superparamagnetic behavior and total magnetization of the gel does not change as the swelling ratio increases. These features make the gel very suitable for applications like magnetic adsorbents.