Biosensing systems that detect and quantify biomolecules at ultra-low concentration, with point of care settings, are of great need in many fields, including diagnostics, disease control, general health monitoring and fundamental research. Over the past decade, detection of biomolecule using magnetic biosensing system, which combines giant magnetoresistive (GMR) sensors and magnetic particles, has been attracting a lot of attention in biosensing area, due to the potential advantages on portability, low cost and rapid detection. This dissertation presents a novel magnetic biosensing system, consisting of highly sensitive GMR sensor and high-moment FeCo magnetic nanoparticle. Based on competition-based detection scheme, this system successfully demonstrates the quantification of ultralow concentration of biomarkers under a small magnetic field in real human serum/urine samples, and differentiates the patients with different grades of cancers. One of the key factors to achieve detection of biomarkers in ultralow concentration is the sensitivity of the GMR biosensor. We designed and fabricated a GMR sensor with a near 0-degree ground state for the magnetization directions between pinned layer and free layer. This configuration enables three times greater sensitivity than any reported traditional GMR biosensor design, and requires much smaller polarization working field (10 Oe) which is more suitable for lab-on-chip and portable diagnostics. Another key factor to increase the system sensitivity is to enhance the magnetic signal of magnetic label. High-magnetic-moment FeCo nanoparticles with great homogeneity, is proposed and synthesized for biomedical application. The net magnetic moment of a FeCo nanoparticle is seven times higher than that of a commercial available Fe3O4 nanoparticle with an applied field of 10 Oe, assuming the same particle size. Moreover, the high homogeneity of FeCo nanoparticle enables the accurate quantification of low-abundance biomarkers. Combining the novel GMR biosensor and high-moment FeCo magnetic nanoparticle, the accurate quantification of various biomarkers in real human serum/urine sample is demonstrated. To assist the high sensitivity quantification, two-layer/three-layer based competition detection schemes are developed. The low concentration interleukin-6 in unprocessed human sera, down to 200 copies, has been detected in only 5 minutes processing time. Based on the results, normal individuals and lung cancer patients were nicely identified. Moreover, the detection of as few as 1000 copies of endoglin is demonstrated in human urine samples. Based on the endoglin concentrations, the patients with different grades of prostate cancer are successfully differentiated.