This study establishes a set of magnetics-based tools that have been integrated with microfluidic systems. The overall impact of the work begins to enable the rapid and efficient manipulation and detection of magnetic entities such as particles, picoliter-sized droplets, or bacterial cells. Details of design, fabrication, and theoretical and experimental assessments are presented. The manipulation strategy has been demonstrated in the format of a particle diverter, whereby micron-sized particles are actively directed into desired flow channels at a split-flow junction by means of integrated microelectromagnets. Magnetic detection has been realized by deploying Giant Magnetoresistance (GMR) sensors--microfabricated structures originally developed for use as readout elements in computer hard-drives. We successfully transferred the GMR technology to the lab-on-a-chip arena, and demonstrated the versatility of the concept in several important areas: real-time, integrated monitoring of the properties of multiphase droplet flows; rapid quantitative determination of the concentration of magnetic nanoparticles in droplets of ferrofluids; and high-speed detection of individual magnetic microparticles and magnetotactic bacteria. The study also includes novel schemes for hydrodynamic flow focusing that work in conjunction with GMR-based detection to ensure precise navigation of the sample stream through the GMR detection volume, therefore effectively establishing a novel concept of a microfabricated …