A durable MR fluid formulation is described which includes mechanically hard magnetizable particles, a carrier fluid derived from a polyalphaolefin and a plasticizer, and at least one colloidal additive such as colloidal polytetrafluoroethylene or colloidal graphite. The use of these colloidal additives inhibits surface-to-surface contact and scuffing while providing reliable lubrication under boundary lubrication conditions.