An improved magnetic separator arrangement is provided. One major improvement relates to modifications facilitating utilization of relatively dense and tightly packed matrix material within races, through which a slurry of ore material passes during separation. The tightly packed matrix material is accommodated through utilization of flexible race walls, and compression and expansion mechanisms selectively operable to facilitate separation. A cover mechanism inhibits water flow turbulence, during an initial setting up of a magnetic field to entrap magnetic material within the matrix element of each race. A preferred retainer mechanism is provided which facilitates mounting of flap members for use in association with a cover mechanism, as well as retention of the matrix material in a desired position. In a preferred embodiment, the previous features are incorporated into a system fed with an ore material from an inner portion of a circular race, i.e. the center of a rotating drum.