The magnetic field measurement mechanism with phase-shifted grating is presented by using transfer matrix approach. The effects of grating parameters on the sensing performance are analyzed by simulations. It shows that the bandwidth and transmission rate of the stop-band transmission window in phase-shifted grating have great effects on the measurements. The results are compared with fiber Bragg grating (FBG) scheme. The simulations and experiments show that the phase-shifted grating with narrow bandwidth and high transmission rate can improve the accuracy and sensitivity of the magnetic sensor system.