Hollow NiFe2O4 nanoparticles are synthesized by self-templating process utilizing coupled interfacial chemical reactions and Kirkendall effect between the core (Ni33Fe67) and the shell (NiFe2O4) of the core/shell structure. Reaction temperature and time dependent structural and morphogical transformations are presented in detail. The kinetics of the transformation from (Ni33Fe67)/(NiFe2O4) nanoparticles to single phased NiFe2O4 hollow nanoparticles was studied by differential scanning calorimetry. Hollow morphology of the particles induces surface effects in the magnetic properties due to the formation of additional inner surfaces. Field cooled hysteresis loop exhibits significantly large shift due to unidirectional anisotropy resulting from the additional inner spin disordered surface along with the existing outer spin disordered surface. The enhancement in the surface anisotropy is also noticeable which leads to an increase in the blocking temperature of the particles with hollow morphology.