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Self-assembled nanocomposite BaTiO3-Mn0.4Zn0.87Fe2O4 magnetodielectric films have been grown on (001)-oriented SrTiO3 substrates by a pulsed laser deposition method. High resolution X-ray diffraction shows that both BaTiO3 and MnZn-ferrite phases are epitaxial along the out-of-plane direction with a 0–3 composite structure in spite of very large lattice mismatch. The magnetic, ferroelectric, and dielectric properties of the nanocomposite films are reported. A saturated magnetization of 330 emu/cc and double remanent polarization of 40 μC/cm2 were obtained. Structural and compositional factors limiting the effective permeability and the dielectric constant will be discussed.