Abstract: Rod-shaped iron oxide nanoparticles were prepared by chemical co-precipitation route using ferric chloridehexahydrate (FeCl3•6H2O) and ferrous chloridetetrahydrate (FeCl2•4H2O) as precursors. Iron oxide nanofluids were prepared by dispersing rod shaped α-Fe2O3 nanoparticles in water. Experiments were carried out to study the influence of surfactants on the colloidal stability, particle size distribution of nanofluids. Nanofluid with Sodium Do-decyl Benzene Sulfonate (SDBS) as surfactant showed increase in thermal conductivity of about 14% when dispersed in water.