In this thesis, we have discussed numerically, the stability of an incompressible flow of a ferrofluid in an annular space between two coaxial rotating cylinders of infinite aspect ratio, in the presence of an axial magnetic field. The system is described by modified Navier-Stokes equation, equation of continuity, Maxwell-equations, and Shliomis''s equation of ferrofluid magnetization. The mathematical model of the physical system, leads to a two-point boundary value problem that has been solved with help of numerical methods. The onset of axisymmetric and non-axisymmetric Taylor vortices, has been discussed. Effect of superposition of radial flow has also been discussed. Also considered is the parametric instability arising as a result of applying periodically oscillating magnetic field to the system.