We report laser-assisted photochemical graphitization of polyimides (PIs) into functional magnetic nanocomposites using laser irradiation of PI in the presence of magnetite nanoparticles (MNPs). PI Kapton sheets covered with MNP were photochemically treated under ambient conditions using a picosecond pulsed laser (1064 nm) to obtain an electrically conductive material. Scanning electron microscopy of the treated material revealed a layered magnetic nanoparticle/graphite (MNP/graphite) nanocomposite structure. Four probe conductivity measurements indicated that the nanocomposite has an electrical conductivity of 1550 ± 60 S/m. Superconducting quantum interference device magnetometer-based magnetic characterization of the treated material revealed an anisotropic ferromagnetic response in the MNP/graphite nanocomposite compared to the isotropic response of MNP. Raman spectroscopy of the MNP/graphite nanocomposite revealed a fourfold improvement in graphitization, suppression in disorder, and decreased nitrogenous impurities compared to the graphitic material obtained from laser treatment of just PI sheets. X-ray photoelectron spectroscopy, x-ray diffraction, and energy-dispersive x-ray spectroscopy were used to delineate the phase transformations of MNP during the formation of MNP/graphite nanocomposite. Post-mortem characterization indicates a possible photocatalytic effect of MNP during MNP/graphite nanocomposite formation. Under laser irradiation, MNP transformed from the initial Fe3O4 phase to γ-Fe2O3 and Fe5C2 phases and acted as nucleation spots to catalyze the graphitization process of PI.