A laboratory sensor model was designed, constructed, and tested based on a newly proposed working principle of magnetic field detection. The principle of sensing employed a time-coded method in correlation with exploiting the advantageous features of the GMI effect. The sensor demonstrated a sensitivity of 10 μs/μT in the field range of ±100 μT. The sensing element in the form of an amorphous thin wire, 100 μm in diameter × 50 mm long, was fit into a small field modulation coil of 60 mm length. At a magnetic field modulation in the range of hundreds of Hz, the change in time interval of two adjacent GMI voltage peaks was linearly related to the external magnetic field to be measured. This mechanism improved the sensor linearity of the GMI sensor to better than 0.2% in the measuring range of ±100 μT.