The magnetic rheologic liquid is composed of components: chelation type surfactant / carbonyl iron hull type magnetic compound particles, and silicone oil based compound assorted carrier liquid prepared from silicone oil and additive. The additive includes thixotropic agent, antioxidant, antiwear additive, and surfactant. The method for preparing the liquid includes steps: mixing round surfactant being added to silicone oil; next, adding antioxidant, thixotropic agent, and antiwear agent, then mixing them to obtain silicone oil based compound assorted carrier liquid; adding magnetic compound particles to the carrier liquid, and after procedures of mixing, ballmilling, and separating out friction balls, then sealing the liquid inside plastic bottle; stable silicone oil based magnetic rheologic liquid is obtained after series of procedure: placing the plastic bottle in magnetic field, taking out the liquid, and mixing etc. The liquid is applicable to damper, variator for cars etc.