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It has been shown that the addition of a small amount of nanoparticles into a fluid results in anomalous increase in the thermal conductivity of the mixture, and the resulting nanofluid may provide better overall thermal management and better lubrication in many applications, such as heat transfer fluids, engine oils, transmission fluids, gear oils, coolants and other similar fluids and lubricants. The potential benefits of this technology to the automotive and related industries would be more efficient engines, reduced size and weight of the cooling and propulsion systems, lowered operating temperature of the mechanical systems, and increased life of the engine and other mechanical systems. The new mechanisms for this phenomenon of anomalous thermal conductivity increase have been proposed. The heat transfer properties of a series of graphite nanofluids were presented, and the experimental results were compared with the conventional heat transfer theory for pure liquids.