This paper presents the development of a variable stiffness and damping isolator using magnetorheological (MR) fluid technology. The MR fluid isolator is composed of two variable volume rubber bladder filled with MR fluid, a pipe and a MR valve connecting them. One of the bladders supports disturbance force and the MR fluid flows between two bladders because of the variation of bladder volume due to deformation. The shear stress of the MR fluid in MR valve is varied by an applied magnetic field, which thereby varies the characteristics of the isolator, such as its stiffness and damping. A mathematical model of the isolator was derived, and a prototype of the MR fluid bladder spring was fabricated and its dynamic behavior was measured in vibration force for a wide range of frequencies under various applied magnetic fields. The parameters of the model under various magnetic fields were calculated and the bladder dynamic performances were evaluated. A non-resonant control was employed to minimize the vibration amplitude of the system. Numerical simulation results indicated that the semiactive control system produced much better isolation performance than a passive system.