The invention is directed to a method for producing metal oxide nanoparticles, the method comprising: (i) subjecting a combination of reaction components to conditions conducive to microbial-mediated formation of metal oxide nanoparticles, wherein said combination of reaction components comprise: metal-reducing microbes, a culture medium suitable for sustaining said metal-reducing microbes, an effective concentration of one or more surfactants, a reducible metal oxide component containing one or more reducible metal species, and one or more electron donors that provide donatable electrons to said metal-reducing microbes during consumption of the electron donor by said metal-reducing microbes; and (ii) isolating said metal oxide nanoparticles, which contain a reduced form of said reducible metal oxide component. The invention is also directed to metal oxide nanoparticle compositions produced by the inventive method.