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Ferrofluids have attracted considerable interest from researchers and engineers due to their rich set of unique physical properties that are valuable for many industrial and biomedical applications. Many phenomena and features of ferrofluids' behavior are determined by internal structural transformations in the ensembles of particles, which occur due to the magnetic interaction between the particles. An applied magnetic field induces formations, such as linear chains and bulk columns, that become elongated along the field. In turn, these structures dramatically change the rheological and other physical properties of these fluids. A deep and clear understanding of the main features and laws of the transformations is necessary for the understanding and explanation of the macroscopic properties and behavior of ferrofluids. In this paper, we present an overview of experimental and theoretical works on the internal transformations in these systems, as well as on the effect of the internal structures on the rheological effects in the fluids. © 2020 by the authors.