The present invention provides a magnetorheological fluid in which magnetic particles coated with a hydrophilic surfactant are dispersed in a water in oil emulsion, and a process for preparing the same. The magnetorheological fluid of the present invention is prepared by adding water to oil dissolved with emulsifier, stirring it to give a mobile phase of water in oil emulsion, and dispersing magnetic particles coated with a hydrophilic surfactant in the water in oil emulsion. The invented magnetorheological fluid is improved in terms of stability through the interaction between surfactant of the magnetic particle surface and water molecule, which makes possible its practical application in the development of variable devices employing the magnetorheological fluid.