A comparison is made between two types of solid particles used in electrorheological fluids: particles with homogeneous electrical properties versus layered particles with a semi-conducting core surrounded by an outer layer of lower conductivity, Rheological measurements of these suspensions under steady sheer and d.c. electric field show that the layered particle system produces the same yield stress but with a substantially reduced electric current. X-ray spectroscopic analysis confirms that these particles have a thin layer of SiOx on the outer surface which causes the reduction in conductivity. Measurement of the dielectric permittivity followed by analysis using the Maxwell-Wagner model of polarization indicates that the conductivity of the outer laver is about 0.62 times that of the core region.