Aging of magnetorheological fluids (MRFs) during the operation of mechanical devices is accompanied by degradation of both the particles and the fluid components. This study has shown that collisions among micron-size magnetic iron particles under shear can result in nanoscale changes to surface topography. Moreover, it has shown that shear-induced collisions can lead to redistributions among different oxidation state species in surface and near sub-surface regions of the particles. The redistributions among oxidation states and chemical species is the result of interfacial reactions that can involve adventitious oxygen, catalysis and other energetic processes that can act on either or both, the host fluid medium and additives introduced to stabilize the MRF. The interfacial chemistry is complex, inviting studies that couple macroscale processes (shear events in a clutch mechanism) with nanoscale inquiry into the effects of such processes. This study examined the chemical and morphological states of MRF particles subjected to continual shear loading in a rotary clutch device over well-defined periods of time for both hydrocarbon and fluorocarbon-based host fluids. New insights into chemical transformations, on and beneath, particle surfaces provide reference for better durability assessment, MRF formulation, and device design in the future. X-ray photoelectron spectroscopy iron, fluorine, oxygen and carbon depth profiles provided insight into the evolving oxidation states of the MRF particles. Over time, fluorine and oxygen insinuate themselves into the particle where they give rise to a host of different oxidized iron species. Simultaneously, the iron content of the surface diminishes. Scanning electron microscopy revealed how the particles transform from nascent nearly spherical shape prior to shear to irregular morphology in the clutch mechanisms. Transmission electron microscopy revealed carbon-rich residues with embedded nanoparticle fragments in aged MRF particle samples, suggesting that MRF particle surfaces may have served as reaction interfaces.