Magnetorheological fluid (MRF), as a smart fluid, can be transformed from liquid state to solid state in several millisecond by applying magnetic fields, and the transformation is reversible, then the size of magnetic field can be controlled smoothly via changing the applied current, which is controllable. Based on the characteristic of MRF, a novel magnetorheological (MR) valve controlled hydraulic cylinder system which used four MR valves in place of conventional mechanical valves is designed. This structure was similar to that of the Wheatstone bridge, its structure characteristics and work principle were introduced, the working efficiency of the system was deduced and the efficiency of the actuator was derived, the working efficiency of MR valve set was deduced, the mathematic model of its structure was established and theoretical analysis was carried out by simulatuion. The simulation results show that the performance of a MR valve controlled hydraulic cylinder system is related to nondimensional parameters, namely δ and μ. On increasing the current to MRV, nondimensional plug thickness δ will increase as well as driving force F, this caused an increase in the efficiency. While the performance and efficiency of system become better with decreasing of viscosity ratio μ.