The structural and magnetic properties and spin dynamics of dextran coated and uncoated γ-Fe(2)O(3) (maghemite) nanoparticles have been investigated using high resolution transmission electron microscopy (HRTEM), (57)Fe nuclear magnetic resonance (NMR), Mössbauer spectroscopy and dc magnetization measurements. The HRTEM observations indicated a well-crystallized system of ellipsoid-shaped nanoparticles, with an average size of 10 nm. The combined Mössbauer and magnetic study suggested the existence of significant interparticle interactions not only in the uncoated but also in the dextran coated nanoparticle assemblies. The zero-field NMR spectra of the nanoparticles at low temperatures are very similar to those of the bulk material, indicating the same hyperfine field values at saturation in accord with the performed Mössbauer measurements. The T(2) NMR spin-spin relaxation time of the nanoparticles has also been measured as a function of temperature and found to be two orders of magnitude shorter than that of the bulk material. It is shown that the thermal fluctuations in the longitudinal magnetization of the nanoparticles in the low temperature limit may account for the shortening and the temperature dependence of the T(2) relaxation time. Thus, the low temperature NMR results are in accord with the mechanism of collective magnetic excitations, due to the precession of the magnetization around the easy direction of the magnetization at an energy minimum, a mechanism originally proposed to interpret Mössbauer experiments in magnetic nanoparticles. The effect of the surface spins on the NMR relaxation mechanisms is also discussed.