The effect of power input, solid content, surfactant concentration, and pH on the kinetics of wet deagglomeration of hematite nanopowder in ultrasonic comminution device and on the rheology of resulting suspensions has been investigated and compared with the kinetics of deagglomeration and rheology of the suspensions of goethite nanopowder. It has been found that the main mechanisms are fragmentation and erosion, which leads to bimodal transient size distributions of aggregates. Fragmentation of large aggregates starts after certain delay time but erosion of nanoparticles starts from very beginning of processing. Deaggregation of hematite nanopowder is only possible in the presence of surfactant, but increase of concentration of surfactant above certain critical value does not affect kinetics of deagglomeration. The increase of solid concentration up to 20 w/w% reduces the amount of energy necessary for deagglomeration of unit mass of the powder. Effect of pH on the kinetics of deagglomeration and the morphology/rheology of the resulting suspensions is discussed. (C) 2009 American Institute of Chemical Engineers AIChE J, 55: 2796-2806, 2009