It is important to separate the nonmagnetic metals from shredded automobiles scraps efficiently. The research relates in general to the separation of non-magnetic metals automatically on the basis of the different density of the magnetic fluids in a magnetic field. A water-based magnetic fluid was prepared with a chemical coprecipitation method by using ultrasonic in dispersing process. The magnetic field system was design and simulated by a finite element analysis software package, ANSYS 8.1. Separation tests were performed on the mixtures of aluminum, zinc, copper and lead with various scrap size and shape using the water-based magnetic fluids.