A nanofluid is a mixture of solid nanoparticles and a common base fluid. Nanofluids have shown great potential in improving the heat transfer properties of liquids. However, previous studies on the characteristics of nanofluids did not adequately explain the enhancement of heat transfer. This study examined the distribution of particles in a fluid and compared the mechanism for the enhancement of heat transfer in a nanofluid with that in a general microparticle suspension. A theoretical model was formulated with shear-induced particle migration, viscosity-induced particle migration, particle migration by Brownian motion, as well as the inertial migration of particles. The results of the simulation showed that there was no significant particle migration, with no change in particle concentration in the radial direction. A uniform particle concentration is very important in the heat transfer of a nanofluid. As the particle concentration and effective thermal conductivity at the wall region is lower than that of the bulk fluid, due to particle migration to the center of a microfluid, the addition of microparticles in a fluid does not affect the heat transfer properties of that fluid. However, in a nanofluid, particle migration to the center occurs quite slowly, and the particle migration flux is very small. Therefore, the effective thermal conductivity at the wall region increases with increasing addition of nanoparticles. This may be one reason why a nanofluid shows a good convective heat transfer performance.