Recently S.C. Saxena, R.S. Miao, M.J. McNallen and M. Shalaby, AIChEJ., 40 (1994) 1594 [1] have shown that an iron powder suspended in a hydrocarbon liquid (Therminol-66) can be effectively separated by sedimentation after magnetization in an external magnetic field. A simple two-step mechanistic model is developed here to analyze quantitatively the separation process data involving the settling rates of group agglomerates. In the first step, the ferromagnetic particles are magnetized, arranged and then pulled together in the magnetic field to form ’particle agglomerates’. In the second step, these particle agglomerates settle under gravity only and grow further in size by collision to form ’group agglomerates’. These group agglomerates settle at a much faster rate because of their large size than the original particles in the untreated powder or the particle agglomerates formed in the magnetic field. The proposed mathematical model in conjunction with the experimental data of Saxena and coworkers [1] has enabled the average diameters of particle agglomerates and group agglomerates to be estimated. It is concluded that this technology has the promise and potential to be employed effectively to separate fine micron size catalyst particles of magnetizable materials suspended in a hydrocarbon liquid. More detailed investigations are warrented to form a basis for elaborate detailed and sound design of separation unit equipment as well as for better understanding of the structural characteristics of particle and group agglomerates.