A power frequency magnetic field reduction method using passive loop is presented. This method can be used to reduce magnetic fields generated within the restricted area near transmission lines by alternating current overhead transmission lines. A reduction algorithm is described and related equations for magnetic field reduction are explained. The proposed power frequency magnetic field reduction method is applied to a scaled-down transmission line model. The lateral distribution of reduction ratio between magnetic fields before and after passive loop installation is calculated to evaluate magnetic field reduction effects. Calculated results show that the passive loop can be used to cost-effectively reduce power frequency magnetic fields in the vicinity of transmission lines generated by overhead transmission lines, compared with other reduction methods, such as active loop, increase in transmission line height, and power transmission using underground cables.