Nanocrystalline cobalt–ferrite particles of size 20–30 nm have been prepared by a reverse coprecipitation technique under the assistance of ultrasonic irradiation and heat-treatment at different temperatures (from 473 K to 1073 K). Both X-ray diffraction and transmission electron microscope analysis confirms the reduction of strain present in the material with annealing temperature. Enhancement of coercivity and magnetization value has been observed without increase in the particle size for whole range of annealing temperature. Temperature dependent magnetization loop shows considerable magnetic hardening at low temperature. The observed enhancement of the coercivity value has been attributed to the increase in magneto-crystalline anisotropy, surface effects and exchange anisotropy. The mechanical properties of the pure cobalt–ferrite samples and cobalt–ferrite reinforced alumina samples were also examined. The Vickers microhardness and the compressive properties obtained from the stress–strain relation showed higher value with annealing temperatures and higher nanoparticle content.