The magnetic fluid was investigated in a gas-liquid reactor made by using plasma activation and ionization reactants at atmospheric pressure. The reaction time was shorted to 2 hours by controlling discharge parameter of plasma and optimizing the thermal decomposition temperature of Fe(CO)5. The magnetic fluid has good fluidity with saturated magnetic intensity of 6.510-2T(non- concentrated). The experiments show that plasma can supply needed activation energy for gas-fluid reactants molecules to recombine and to form magnetic fluid, and it is effective method for synthesis of magnetic fluid.