A highly sensitive magnetic sensor using the GMI (Giant Magneto Impedance) effect has been developed. The sensor performance is studied and estimated. The sensor circuitry consists of a Square wave generator (driving source), a sensing element in a form of composite wire of a 20μm copper core electrodeposited with a thin layer of soft magnetic material (Ni80Fe20), two amplifier stages for improving the gain from the sensor element, switching mechanism, scaler circuit, an ac power source driving the permeability of the magnetic coating layer of the sensing element into a dynamic state, and a signal pickup LC circuit formed by a pickup coil and an capacitor .The results showed that for high sensitivity and resolution (10-7 T), the frequency and magnitude of the ac driving current through the sensing element each has an optimum value, the resonance frequency of the signal pickup LC circuit should be equal to or twice as the driving frequency on the sensing element, and the anisotropy of the magnetic coating layer of the sensing wire element should be longitudinal.