SummaryRecent technological advances suggest that we are on the threshold of a new era in applied magnetic surveys, where acquisition of magnetic gradient tensor data will become routine. In the meantime, modern ultrahigh resolution conventional magnetic data can be used, with certain important caveats, to calculate gradient tensor elements from total magnetic intensity (TMI) or TMI gradient surveys. Until the present, not a great deal of attention has been paid to processing and interpretation of gradient tensor data. New methods for inverting gradient tensor surveys to obtain source parameters have been developed for a number of elementary, but useful, models. These include point pole, line of poles, point dipole (sphere), line of dipoles (horizontal cylinder), thin and thick dipping sheets, sloping step and contact models. A key simplification is the use of eigenvalues and associated eigenvectors of the tensor. The scaled source strength, calculated from the eigenvalues, is a particularly useful rotational invariant that peaks directly over compact sources, 2D sources and contacts, independent of magnetisation direction. New algorithms for uniquely determining the location and magnetic moment of a dipole source from a few irregularly located measurements or single profiles have been developed. Besides the geological applications, these algorithms are readily applicable to the detection, location and classification (DLC) of magnetic objects, such as naval mines, UXO, shipwrecks, archaeological artefacts and buried drums. As an example, some of these new methods are applied to analysis of the magnetic signature of the Mount Leyshon gold-mineralised system, Queensland.