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This paper investigates the effect of thermal radiation and heat transfer on the flow of ferromagnetic fluid on a stretching sheet. The appropriate combination of non-magnetic viscous base fluid, magnetic solid and surfactant composes magnetic fluid in the presence of magnetic dipole. The momentum and energy equations with the interaction of ferromagnetic particles formulate governing equations. Similarity transformation is applied on the governing equations to transform partial differential equations to nonlinear ordinary differential equations. A numerical solution is obtained and the effects of magnetic dipole and thermal radiation on dimensionless velocity, temperature, pressure, skin friction and Nusselt number are illustrated graphically.