Manipulation of aqueous droplets inside a microchannel is of great importance in microfluidic applications. Obstacle-based trapping of droplets inside microchannel has certain limitations such as reversal of flow to release the trapped droplets, flow hindrance, etc. In recent years, active methods of droplet trapping are becoming more popular and efficient. A magnetic field produced by a permanent magnet repels diamagnetic (aqueous) droplets flowing in a paramagnetic (oil-based ferrofluid) continuous-phase (CP) in the direction of the minimum magnetic field- Negative magnetophoresis (NMP). NMP is employed for trapping and subsequent release of aqueous droplets inside a microchannel. The relative dominance of the NMP force and the viscous drag exerted by the CP on the droplets decide the trapping, nontrapping, and releasing of the droplets as well as the location of the entrapment. We used magnetophoretic stability number (ratio of magnetic to viscous energies), Smp, and non-dimensionalized droplet size, D* to characterize regimes of trapping and non-trapping. The droplets get released upon removal of the magnetic field. It is also observed that trapped droplets get released upon coalescing with follower droplets coming from upstream and shifting to the non-trapping regime according to the Smp and D* criterion. The study of coalescence of a trapped droplet with a follower droplet (and a train of droplets) revealed that the film-drainage Reynolds number (Refd) representing the coalescence time depends on the magnetic Bond number, Bom. This method of trapping and self-releasing can be used for chemical assaying and lysis of biological cells encapsulated in aqueous droplets.