We report how live cells and functionalized colloidal particles can be coassembled into a variety of freely suspended bioactive structures using dielectrophoresis on a chip. Alternating electric fields were applied to dilute suspensions of yeast (S. cerevisiae) and NIH/3T3 mouse fibroblast cells to yield 1D chains and 2D arrays. The effects of voltage, frequency, pH, electrolyte concentration, cell concentration, and particle size on the assembly process were investigated in detail. Numerical simulations of the field intensity and energy allow the capture of the dynamics of cell-cell and cell-particle assembly. The simulation results illustrate that the electric field draws the functionalized synthetic particles between the cells and enables the formation of permanent chains and monolayer membranes composed of alternating cells and particles. The cell structures were bound into permanent structures by different types of functionalized synthetic particles and ligands that attached to the cells through biospecific or electrostatic interactions. The technique allowed the fabrication of magnetically responsive biomaterials that could be manipulated and transported into and out of the microchambers where they were formed.