In this article, we demonstrate that specifically engineered oxide nanoparticles (NPs) have the potential to act as theranostic materials that are able to generate or prevent oxidative stress through their oxi-redox activity in various types of malignant and nonmalignant cells. The oxi-redox activity is related to the type and presence of surface defects, which is modified with appropriate synthesis conditions. In the present work, we used MDA-MB-231 and MCF-7 human breast cancer cells and nonmalignant MCF-10A human breast cells to demonstrate how controlled oxidative stress mediated by specifically nanoengineered indium tin oxide (ITO) NPs can selectively induce cell death in the cancer cells while reducing the oxidative stress in the normal cells and supporting their proliferation. The ITO NPs are also promising nanotheranostic materials for cancer therapy and contrast agents because of their multimodal imaging capabilities. We demonstrate that the synthesized ITO NPs can selectively increase the generation of reactive oxygen species (ROS) in both breast tumor cell lines, resulting in activation of apoptosis, and can also greatly suppress the cellular proliferation in both types of tumor cells. In contrast, the ITO NPs exhibit ROS scavenging-like behavior, significantly decreasing the ROS levels in MCF-10A cells exposed to the additional ROS, hydrogen peroxide (H2O2), so that they protect the proliferation of nonmalignant MCF-10A cells from ROS damage. In addition, fluorescent microscopy images revealed that the ITO NPs emit strong fluorescence that could be used to reveal their location. Moreover, computed tomography imaging demonstrated that the ITO NPs exhibited a comparable capability toward anatomical contrast enhancement. These results suggest that the synthesized ITO NPs have the potential to be a novel selective therapeutic agent with a multimodal imaging property for anticancer treatment.