Ultrafine magnetite powder for the ferromagnetic fluid was prepared by an addition of alkaline solution to the solution containing Fe2+ and Fe3+ ions at 6$0^{circ}C$. The optimum condition of the magnetite synthesis was delineated by examining such various physico-chemical properties as Fe2+/Fe+3 ratio in the powder, phase characteristics, MHC and $sigma$max. A new scheme for the steric stabilization of colloidal dispersion was proposed using the concept of the buffer group action for the increased interfacial density of the stabilizing moieties at colloid particle/dispersion medium interface. The proposed concept was successfully applied to the preparation of the kinetically stable kerosinebased ferrofluid using Tween and Span as dispersants. In the dispersion of magnetite particles in a kerosine, Tween(polyoxyethylene sorbitan oleate) acts as a primary stabilizer which provides an anchor group, whereas Span(sorbitan oleate) can be classified as a secondary stabilizer which adsorbs on the surface of magnetite particle through the action of the buffer group. Dispersion studies using various quantities of Tween and Span supported the concept of the buffer group action for increased dispersion characteristics of the kerosine based ferromagnetic fluid.