Magnetic 'nanofactories', for localized manufacture and signal-guided delivery of small molecules to targeted cell surfaces, are demonstrated. They recruit nearby raw materials for synthesis, employ magnetic mobility for capture and localization of target cells, and deliver molecules to cells triggering their native phenotypic response, but with user-specified control. Our nanofactories, which synthesize and deliver the "universal" bacterial quorum-sensing signal molecule, autoinducer AI-2, to the surface of Escherichia coli, are assembled by first co-precipitating nanoparticles of iron salts and the biopolymer chitosan. E. coli AI-2 synthases, Pfs and LuxS, constructed with enzymatically activatable "pro-tags", are then covalently tethered onto the chitosan. These enzymes synthesize AI-2 from metabolite S-adenosylhomocysteine. Chitosan serves as a molecular scaffold and provides cell capture ability; magnetite provides stimuli responsiveness. These magnetic nanofactories are shown to modulate the natural progression of quorum-sensing activity. New prospects for small molecule delivery, based on localized synthesis, are envisioned.