Iron, cobalt, and nickel are magnetic primarily due to their unique electron configurations, which allow their magnetic dipoles to align in an external magnetic field. While there are other magnetic materials like gadolinium and ferrites, these elements are the most notable ferromagnetic materials at room temperature. The alignment of magnetic dipoles in ferromagnetic materials results in a strong magnetic field, unlike other materials where dipoles remain randomly oriented. The discussion also touches on how magnets are typically created by applying an external magnetic force and mentions that the first magnets were naturally occurring due to Earth's magnetic field. Additionally, the difference between ferromagnets and electromagnets is noted, with emphasis on the role of electron spin and conduction in magnetism.