  X-ray diffraction studies of fine polycrystalline samples of MgB$_2$ in the
superconducting state reveal that crystals orient with their \emph{c}-axis in a
plane normal to the direction of the applied magnetic field. The MgB$_2$
samples were thoroughly ground to obtain average grain size 5 - 10 $\mu$m in
order to increase the population of free single crystal grains in the powder.
By monitoring Bragg reflections in a plane normal to an applied magnetic field
we find that the powder is textured with significantly stronger (\emph{0,0,l})
reflections in comparison to (\emph{h,k,0}), which remain essentially
unchanged. The orientation of the crystals with the \emph{ab}-plane parallel to
the magnetic field at all temperatures below $T_c$ demonstrates that the sign
of the torque under magnetic field does not alter, in disagreement with current
theoretical predictions.
