The source of the unusual ferromagnetism of nanowires (NWs) such as CoSi-SiO2 has been studied by first-principles calculations. While previous experiments on ferromagnetic NWs presumed that their magnetism was the result of metal ions at the interface suffering reduced coordination, first-principles calculations of such a configuration revealed that this would only account for ~20% of the measured magnetization. Selected area electron diffraction (SAED) transmission electron microscopy (TEM) diffraction patterns collected in the metal interface region indicated that a superlattice structure was present, contrary to the bulk. We take the case of CoSi-SiO2 NWs, and using simulated diffraction patterns, verify the CoSi ordered vacancies superstructure interpretation of experiment. With first principles simulations, once the ordered vacancies are incorporated with interface Co atoms, the resulting simulations result in a ~97% agreement with the experimental magnetization. Our results clearly indicate that these internal, ordered vacancies in NWs are the dominant mechanism for the observed ferromagnetism. Density of states calculations show that as the metal atom’s coordination inside the ordered vacancies structures increase, the overall magnetization decreases. For CoSi nanowires, the variations of the Co moments at different sites depend on the vacancy configuration, which can be understood through the effects of the bond lengths on Co atom’s moments. According to the Bethe-Slater curve, there is a requisite bond length range for the presence of enough exchange energy to permit ferromagnetism. We find that this bond length plays a crucial role in setting the distribution of Co moments about the vacancies.