Our purpose is to develop a precision magnetic displacement sensor that has sub-micron resolution and small size probe. To achieve this, we first have tried to establish mathematical models of a magnetic sensor in this paper. The inductance model that presents basic measuring principle of a magnetic sensor is based on equivalent magnetic circuit method. Especially we have concentrated on modeling of magnetic flux leakage and magnetic flux fringing. The induced model is verified by experimental results. The model, including the magnetic flux leakage and flux fringing effects, is in good agreement with the experimental data. Subsequently, based on the augmented model, we will design magnetic sensor probe in order to obtain high performances and to scale down the probe.