Fe3O4/poly(o-anisidine) (POA) magnetic composite nanoparticles with their core-shell structure were synthesized by chemical oxidation polymerization technique and adopted as a magneto-responsive magnetorheological (MR) material. The chemical structure and morphology of core-shell nanoparticles were identified by FT-IR, SEM, TEM, and elemental analyzer. Pycnometer and vibrating sample magnetometer showed that the magnetic saturation and density of the Fe3O4/POA particles were reduced by the POA shell coatings. The rheological properties of the MR suspension dispersed in a silicone oil at various magnetic field strengths were investigated using a rotating rheometer under a magnetic field. The resulting MR suspension showed a typical Newtonian fluid behavior in the absence of external stimuli. When an external magnetic field was applied, it formed a strong chain structure, acting like a solid with a yield stress. Further solid-like behaviors were observed from storage shear relaxation and viscoelastic tests. Finally, the Fe3O4/POA nanoparticles showed better dispersion stability than pure Fe3O4 nanoparticles with 50% improvement.