This study focuses on the magnetorheology and sensing capability of graphite based Magnetorheological Elastomers (Gr MREs). By introducing graphite (Gr) to conventional MREs, the Gr MREs are derived. The anisotropic sample with 20% graphite weight fraction was selected to be compared with anisotropic conventional MREs. The microstructures of anisotropic Gr MREs and conventional MREs were observed. Both steady state tests and dynamic tests were conducted to study rheological properties of the samples. For dynamic tests, the effects of strain amplitude, and frequency on both storage modulus and loss modulus were measured. For sensing capability, the resistance of selected Gr MREs under different magnetic fields and external loadings is measured with a multi-meter. Either higher magnetic field or more external loading results in the resistance increment. Based on an ideal assumption of perfect chain structure, a mathematical model was proposed to investigate the relationship between the MRE resistance with the external loadings. In this model, the current flowing through the chain structure consists of both tunnel current and conductivity current, both of which depends on external loadings. The modelling parameters were identified and reconstructed from comparison with experimental results. The comparison indicates that both experimental results and modelling prediction agree favourably well.