Magnetorheological (MR) fluids, suspension of magnetic pure carbonyl iron (CI) in non magnetic carrier, were prepared with and without magnetic CI nanoparticle additive in this study. Initially, the magnetic CI nanoparticle additive was synthesized in a rather simple process of decomposition of penta carbonyl iron (Fe(CO)(5)) using oleyl amine and kerosene. Magnetic property and morphology of the synthesized magnetic CI nanoparticles were confirmed via vibration sample magnetometer (VSM) and transmission electron microscopy (TEM), respectively. MR fluids, prepared as a mixture of pure CI and CI nanoparticle additive of different weight ratio in carrier fluid, was investigated under different external magnetic field strengths via a rotational rheometer. Sedimentation of the MR fluid was characterized by an optical analyzer, Turbiscan. Their flow behaviors at a steady shear mode were examined with and without magnetic CI nanoparticle additive under magnetic field strength. The MR fluids with magnetic CI nanoparticles added demonstrated slightly higher yield behaviors, suggesting that pure CI and CI nanoparticle additive were being oriented in the magnetic field direction under an applied magnetic field and with much strengthened structure.