Smart composites based on carbonyl-iron particles in a polyurethane matrix, known as magnetorheological elastomers (MREs), were manufactured and studied. The influence of ferromagnetic particle content and particle arrangement in relation to an external magnetic field was investigated. Several different elastomers with different stiffnesses were used as matrices. It was found that the structure of a fabricated MRE depends on the viscosity of the matrix before curing and the flux density of the applied magnetic field. Two different magnetic field strengths were used: 0.1 and 0.3 T. The amount of carbonyl iron particles was varied from 1.5 to 33.0 vol%. Scanning electron microscopy technique was used to observe MRE microstructure. The particles' orientation and their arrangement were also investigated by vibrating sample magnetometer. A correlation was found between MRE microstructure and magnetic properties. Compression tests on cylindrical samples in the presence and absence of a magnetic field showed that a magnetic field increased the stiffness of the material. Additionally the rheological properties of MREs were tested in a magnetic field. It was found that the amount of ferromagnetic particles and their arrangement have a significant influence on the rheological properties of MREs. The highest relative change of storage modulus under 200 mT magnetic field, equal to 282%, was recorded for samples with 11.5 vol% of particles.