A constitutive model for dispersions of acicular magnetic particles has been developed by modeling the particles as rigid dumbbells dispersed in a solvent. The effects of Brownian motion, anisotropic hydrodynamic drag, a steric force in the form of the Maier-Saupe potential, and, most importantly, a mean-field magnetic potential are included in the model. The development is similar to previous models for liquid-crystalline polymers. The model predicts multiple orientational states for the dispersion, and this phase behavior is described in terms of an orientational order parameter S and an average alignment parameter J; the latter is introduced because the magnetic particles have distinguishable direction due to polarity. A transition from isotropic to nematic phases at equilibrium is predicted. Multiple nematic phases-both prolate and oblate-are predicted in the presence of steady shear flow and external magnetic field parallel to the flow. The effect of increasing magnetic interparticle interactions and particle concentration is also presented. Comparisons with experimental data for the steady shear viscosity show very good agreement. (C) 2003 Elsevier Science (USA). All rights reserved.