Dysprosium composite cobalt ferrite ionic magnetic fluids were prepared by precipitation in the presence of Tri-sodium citrate. Influence of dysprosium modification on magnetic property is studied. The result shows that magnetic response toward exterior magnetic field can be improved by adding Dy3+. Studies also show that the increase of reaction temperature may improve the modification effect of dysprosium. By adding dysprosium ions, the average diameter of the magnetic nanoparticles will be decreased evidently. It is clear that the particles appear as balls, Cobalt ferrite with sizes of 12-15 nm, rare earth composite cobalt ferrite with sizes of 6-8 nm.