This study describes an immunomagnetic nanoparticle (IMNP)-based lateral flow assay (LFA) for detecting the major peanut allergen Ara h 1. We developed a clearly specific method in identifying peanut from ten other seeds and nuts, and a good visual limit of detection (vLOD) of 0.01 μg/mL Ara h 1 in PBS. PBS that contains 1 M NaCl and 2% Tween 20 was determined to be the optimal extraction buffer for isolating Ara h 1 from cookie, milk and chocolate with vLOD values of 0.5 μg/g, 0.5 μg/mL, and 1 μg/g, respectively. Forty two processed foods were simultaneously analyzed using this method and an AOAC-approved ELISA kit. The specificity and sensitivity of this assay were thus determined to be 100 and 95%, respectively. This new IMNP-based LFA has potential as a rapid tool for screening processed foods for Ara h 1 residues.