The current study describes a straightforward, biologically and environmentally friendly method for creating magnetic iron oxide (γ-Fe2O3) nanoparticles. We report here that theBacillus subtilisSE05 strain, isolated from offshore formation water near Zaafarana, the Red Sea, Hurghada, Egypt, can produce highly magnetic iron oxide nanoparticles of the maghemite type (γ-Fe2O3). To the best of our knowledge, the ability of this bacterium to reduce Fe2O3has yet to be demonstrated. As a result, this study reports on the fabrication of enzyme-NPs and the biological immobilization of α-amylase on a solid support. The identified strain was deposited in GenBank with accession number MT422787. The bacterial cells used for the synthesis of magnetic nanoparticles produced about 15.2 g of dry weight, which is considered a high quantity compared to the previous studies. The XRD pattern revealed the crystalline cubic spinel structure of γ-Fe2O3. TEM micrographs showed the spherically shaped IONPs had an average size of 7.68 nm. Further, the importance of protein-SPION interaction and the successful synthesis of stabilized SPIONs in the amylase enzyme hybrid system are also mentioned. The system showed the applicability of these nanomaterials in biofuel production, which demonstrated significant production (54%) compared to the free amylase enzyme (22%). Thus, it is predicted that these nanoparticles can be used in energy fields.