Abstract: Magnetorheological fluid (MRF) has drawn much attention due to its powerful shearing stress. The yield stress of MRF is about ten times greater than that of electrorheological fluid (ERF). But a projecting question is the subsidence of particles as a result of gravity for magnetorheological fluid. Fe particles have been prepared with microemulsion, and being coated by protein, polymeric protein-Fe particles have been obtained. The preparation of MRF, and XRD,TEM,IR analysis of surface structure for protein-Fe have been reported in the paper. The magnetorheological, temperature effects and subsidence stability have been investigated also on MRF of protein-Fe. The results show that the protein-Fe is a complex particle composition from crystal α-Fe and non-crystal protein. The magnetorheological fluid has good magnetorheological effect, and its subsidence stability is excellent compared with the single carbonyl iron.