A magnetic field sensing system with a single primary sensor and multiple reference sensors deployed locally and orthogonally, was proposed for downlink signal reception and interference cancelling for Through-the- Earth Communication (TEC). This paper mathematically analyzes a design optimization process for a search coil magnetometer (SCM), and applies that process to minimize the bandwidth of the primary SCM for TEC signal reception and the volume of reference SCMs for multiple distributions. The primary SCM achieves a 3- dB bandwidth of 7 Hz, a sensitivity threshold of 120 fT/√Hz, and a volume of 2.32 × 10⁻⁴ m³. The entire sensing system volume is as small as 10⁻² m³. Experiments with interference from industrial frequency harmonics demonstrated an average of 36 dB and 18 dB improvements in signal-to-interference ratio and signal-tointerference plus noise ratio, respectively, using multichannel recursive-least-squares algorithm. Thus, the proposed sensing system can reduce the interference effectively and allows reliable downlink signal reception.