In the last six years, the synthesis of MXene-based quantum dots (MXQDs) has gained widespread attention. Due to the quantum confinement effect, it is possible to significantly improve their properties compared to 2D counterparts, such as higher chemical stability and better electronic and optical properties. However, despite the growing interest in their properties, much remains unexplored. One of the biggest challenges is to study in more detail the structure of quantum dots, in particular, their edge functionalization and its effect on their properties. In this paper, the structural stability and electronic and magnetic properties of Ti2CO2 QDs based on different lateral dimensions and edge functionalization (-O, -F, and -OH) are investigated using density functional theory. The study shows that the energy gap of Ti2CO2-O QDs decreases with increasing lateral size for both nonmagnetic (spin-unpolarized, close shell) and magnetic (spin-polarized, open shell) cases. Furthermore, the magnetic behavior of quantum dots was revealed by shrinking from 2D Ti2CO2 to 0D Ti2CO2 QDs with lateral dimensions below 1.4 nm. The binding energy confirms the stability of all three types of edge functionalization, while the most stable structure was observed under fully saturated edge oxygenation. Moreover, it was also found that the spin density distribution and the energy gap of Ti2CO2-X QDs (X = O, F, and OH) are both dependent on the type of atom saturation. Size and edge confinement modeling has been demonstrated to be an effective tool for tuning the electronic and magnetic properties of MXQDs. Moreover, the observed enhanced spin polarization together with tunable magnetic properties makes the ultrafine Ti2CO2-X QDs promising candidates for spintronic applications.

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