Iron mineral transformations occurring in hydrocarbon-contaminated sites are linked to the biodegradation of the hydrocarbons. At a hydrocarbon-contaminated site near Bemidji, Minnesota, USA, measurements of magnetic susceptibility (MS) are useful for monitoring the natural attenuation of hydrocarbons related to iron cycling. However, a transient MS, previously observed at the site, remains poorly understood and the iron mineral phases acting as reactants and products associated with this MS perturbation remain largely unknown. To address these unknowns, we acquired mineral magnetism measurements, including hysteresis loops, backfield curves, and isothermal remanent magnetizations on sediment core samples retrieved from the site and magnetite-filled mineral packets installed within the aquifer. Our data show that the core samples and magnetite packs display decreasing magnetization with time and that this loss in magnetization is accompanied by increasing bulk coercivity consistent with decreased average grain size and/or partial oxidation. Low-temperature magnetometry on all samples displayed behavior consistent with magnetite, but samples within the plume also show evidence of maghemitization. This interpretation is supported by the occurrence of shrinkage cracks on the surface of the grains imaged via scanning electron microscopy. Magnetite transformation to maghemite typically occurs under oxic conditions, here, we propose that maghemitization occurs within the anoxic portions of the plume via microbially mediated anaerobic oxidation. Mineral dissolution also occurs within the plume. Microorganisms capable of such anaerobic oxidation have been identified within other areas at the Bemidji site, but additional microbiological studies are needed to link specific anaerobic iron oxidizers with this loss of magnetization.