A liquid crystalline polysiloxane (LCP), having an ether bond in the spacer between its siloxane main chain and its mesogenic-group side chains, exhibited a very small electrorheological (ER) effect or increase in shear stress upon application of an electric field, but mixtures of the LCP and polydimethylsiloxane (PDMS) exhibited a sharply increasing ER effect with increasing PDMS content throughout the tested range of up to 0.5 of PDMS weight fraction. When phenyl-substituted PDMS (Ph-PDMS) at a weight fraction of 0.3 was used instead of PDMS, however, the ER effect decreased with increasing phenyl content and became nearly undetectable with Ph-PDMS having a phenyl content (ratio of substituted phenyl groups to initial methyl groups) of approximately 15%. DSC analyses showed that the ER effect of the LCP/PDMS mixtures occurred undiminished throughout a temperature range in which LCP itself is an isotropic Liquid in the absence of an applied electric field and suggested that the LC structure of the LCP was maintained even when it was diluted with PDMS in weight fractions of 0.5 or higher, but disrupted when diluted by a 0.3 weight fraction of Ph-PDMS having a 15% phenyl content. Optical microscopic observation of the mixtures of the LCP with a 0.3 weight fraction of PDMS or Ph-PDMS (15% phenyl content) showed that both consisted of uniformly dispersed micron-sized droplets which became elongated in the direction of the applied electric field when it was applied alone but became smaller when both the electric held and shear were applied. These results suggest that the phase separation between the LCP and the dilution oil, as well as the existence and orientation of LC domains, is essential for the generation of a large ER effect.