The technique of pulsed laser ablation in liquid has been developed to achieve one-step synthesis of diverse gold/oxide nanocomposites with uniform morphology and superior dispersibility. High-speed photography and transmission electron microscopy observations reveal that many metal nanodroplets are ejected from the target immersed in the liquid medium during the ablation process. The nanodroplets adsorb oxygen and gold atoms that are decomposed in the solution, and form nanocomposites at high temperature. The nanocomposites exhibit excellent properties, such as enhanced catalytic activity with the increasing of the cycle number, and bifunctional character with optical and magnetic effects. Since the pulsed-laser-ablation-in-liquid process is free of toxic agents, the nanocomposites have unique advantages for catalysis or biotechnology.