The present invention relates to a method of manufacturing a magnetic recording medium comprising coating a magnetic layer coating liquid comprising a ferromagnetic hexagonal ferrite powder and a binder to form a coating film, subjecting the coating film to orientation processing while the coating film is still wet, and drying the coating film to form a magnetic layer. The magnetic layer coating liquid is prepared by subjecting a ferromagnetic hexagonal ferrite powder with an average plate diameter of 10 to 50 nm to a dry comminution step, subjecting the ferromagnetic hexagonal ferrite powder to a first dispersion step together with a binder to prepare a dispersion liquid, and sequentially subjecting the dispersion liquid obtained to a second dispersion step and a filtering step. The dispersion liquid obtained by the first dispersion step comprises a dry solid component in an amount, as measured after filtration, of 15 percent or less.