In this work, a new finishing process has been proposed for polishing a work piece made of AISI D3 steel material with the use of magnetorheological (MR) fluid as working medium. Magnetorheological fluid finishing process is considered as one of the important non-conventional methods for polishing the complicated shapes as well as hard material components. The experimentation is carried out on predominating factors like the ratio of CIPs to Al2O3 abrasive particles, magnetizing current, the rotating speed of the tool, feed rate of work piece, working gap and hardness of work pieces to get the response as a percentage change in surface roughness. To design the experiments, a full factorial design is employed and the results are analyzed with the help of regression and ANOVA method. The results of experimentation reveal that the major contribution of the parameters to improve the surface finish is of working gap, current applied to the electromagnet and the hardness of the workpiece followed by the rotating speed of the tool, the ratio of CIP to abrasive and feed rate of the workpiece. Further, results showed that the average percentage deviation between the observed and the predicted value is less than 4%. © Springer Nature Singapore Pte Ltd. 2020.