The prospect of combining both magnetic and plasmonic properties in a single nanoparticle promises both valuable insights on the properties of such systems from a fundamental viewpoint and numerous possibilities for technological applications. However, the combination of two of the most prominent metallic candidates—iron and silver—has presented numerous experimental difficulties because their thermodynamic properties impede miscibility and even coalescence. Herein, we present the thorough characterization of physically prepared Fe50Ag50 nanoparticles embedded in carbon and silica matrices via electron microscopy, optical spectroscopy, magnetometry and synchrotron-based X-ray spectroscopy. Iron and silver segregate completely into structures resembling fried eggs, with a nearly spherical, crystallized silver part surrounded by an amorphous structure of iron carbide or oxide, depending on the environment of the particles. Consequently, the particles exhibit both plasmonic absorption corresponding to the silver nanospheres in an oxide environment and a reduced but measurable magnetic response. The suitability of such nanoparticles for technological applications is discussed from the viewpoint of their high chemical reactivity with their environment.