This paper studies constructing advanced effective materials using arrays of circular radially-anisotropic (RA) cylinders. Homogenization of such cylinders is considered in an electrodynamic case based on Mie scattering theory. The homogenization procedure consists of two steps. First, we present an effectively isotropic model for individual cylinders, and second, we discuss the modeling of a lattice of RA cylinders. Radial anisotropy brings us extra parameters, which makes it possible to adjust the desired effective response for a fixed frequency. The analysis still remains simple enough, enabling a derivation of analytical design equations. The considered applications include generating artificial magnetism using all-dielectric cylinders, which is currently a very sought-after phenomenon in optical frequencies. We also study how negative refraction is achieved using magnetodielectric RA cylinders.