Magnetorheological elastomers (MREs) are materials that exhibit a change in their mechanical properties, such as stiffness and damping, in response to an applied magnetic field. In general, MREs consist of an elastomeric matrix and homogeneously dispersed magnetic particles, which allow for adjustable viscoelastic properties when a magnetic field is applied. This property, known as magnetorheological (MR) effect, is a result of the alignment of magnetic particles in response to the field and enables the control of the material's mechanical properties and makes it useful for semi-active vibration isolation. Despite the inherent viscoelastic-property change of MREs, their damping capabilities and MR effect are adversely affected by the slow response time and suspension of the particles that are dispersed within the material. To address this, a hybrid MRE is developed by encapsulating MR fluid inside the elastomer, enhancing its performance in longitudinal and torsional vibration isolation. A semi-active base isolator is fabricated using the hybrid MRE as the elastomeric element, showing effectiveness in attenuating vibrations and exhibiting superior MR effect and damping characteristics compared to conventional MREs. The study concludes that the hybrid isolator can enhance the performance and MR effect while simultaneously reducing magnetic field requirements. Additionally, a parametric model that can predict the nonlinear and hysteretic behavior of the hybrid MRE is proposed. These findings reveal the potential of hybrid MREs for developing smart isolation systems in future research.