A flexible permanent magnet containing atomized, generally spherical rare earth magnet particles bonded in a binder resin including a nitrile rubber and precipitated amorphous silica. The bonded permanent magnet exhibits high mechanical flexibility and elasticity, good magnetic properties, and good heat aging, and the magnet powder may be mixed with the binder resin with little to no risk of combustion. In an exemplary embodiment, a permanent magnet composition includes a nitrile rubber with about 23-37% acrylonitrile content, an ethylene vinyl acetate copolymer, a precipitated amorphous silica, and atomized, generally spherical rare earth magnet particles having a size distribution including a median particle size in the range of about 35-55 nullm with a standard deviation in the range of about 10-30 nullm and less than about 0.1% of the particles having a diameter above about 115 nullm. Bonded permanent magnets of the present invention exhibit a percent ultimate elongation greater than about 100%, and even greater than about 200%, thereby providing at least a 10-fold improvement in elasticity concurrently with good magnetic properties.