We have investigated the orientational distributions and rheological properties of dilute colloidal dispersions, which consist of ferromagnetic spherocylinder particles. First, the governing equation of the orientational distribution function has been derived for the typical two cases of magnetic field directions: the direction parallel to the shear flow and the direction parallel to the angular velocity vector of the shear flow. The equation has been solved approximately by Galerkin's method. With these numerical solutions we have obtained the results of the orientational distribution and viscosity. The results obtained for the magnetic field in the shear flow direction are summarized as follows. In the case of a weak magnetic field, the particle tends to orient nearly toward the shear flow direction and its opposite direction. As the magnetic field increases, the orientation of the particle is restricted and the viscosity increases significantly. As the influence of the magnetic field becomes dominant, an overshoot in the viscosity curve appears. This is due to the fact that there is a maximum deviation of the averaged particle direction from the magnetic field direction. When the strength of the magnetic field increases significantly, the particle inclines close to the magnetic field direction and the viscosity converges to a constant value. Particles with a larger aspect ratio give rise to a larger increment in the viscosity since such elongated particles induce larger resistance in a flow field. We also have obtained results for the case of the magnetic field in the direction parallel to the angular velocity vector of the shear flow. When the flow field is dominant over both the rotational Brownian motion and the magnetic interaction, the particle rotates in the plane nearly perpendicular to the magnetic field direction. As the magnetic field increases, the particle inclines toward the magnetic direction. For this direction of field, the viscosity is independent of the magnetic field and is always zero.