In this study, three types of available processing aids; namely naphthenic oil (PTO), light mineral oil (MO) and epoxidised palm oil (EPO), were used as a dispersing agent to investigate the effects of physicochemical and viscoelastic properties of magnetorheological elastomers (MREs). EPO was selected as the natural-based processing aids, and its morphological, magnetic properties, mechanical and rheological properties of EPO based MREs was compared with the petroleum-based dispersing aids such as light MO and PTO at a fixed amount of 10 phr. The results indicated that EPO was the best alternative of dispersing agent for the MRE rather than the light MO and PTO. In addition, the morphological, magnetic and mechanical properties of the MRE suggested that the EPO could promote compatibility and provide a better lubricant property between the rubber molecular and magnetic particles. It has been observed that the field-dependent storage modulus and MR effect of MRE samples were improved with the addition of dispersing aids, where the MR effect of MRE with the EPO has showed the highest performance of 12%.