This article describes the characterization of the SQUID-based time domain electromagnetic (TDEM) system for use in geophysical applications. This system has been characterized near the laboratory where the background noise, especially the cultural noise, is relatively low. A transmitter loop in the form of a square (2 × 2 m) with the excitation current of 0.212 A in the form of modified square pulses with a frequency of 2.5 Hz has been used to induce eddy currents in a nearby conducting target. A three-axes low Tc dc SQUID magnetometer and its associated fast readout electronics have been used to record the transient response of the target. Meanwhile, as part of this developmental work and to get the field experience, the TDEM measurements have been performed in the field with transmitter loop size of 100 × 100 m and fluxgate magnetometer as a receiver. Here, we observed that the decay of the secondary magnetic field has always unexpectedly reached a negative value even at the earlier time windows. Subsequently, the TDEM experiments with fluxgate as the receiver have been repeated with the same configuration as done in the past with SQUID, and the performance of the magnetometers, such as fluxgate and SQUID, have been compared. The experimental results were analyzed in detail and show that the fluxgate magnetometer behaves as the combination of magnetic field sensor and induction coil at earlier decay times, and magnetic field sensor only at later decay times.