Conventional rf SQUIDs (superconducting quantum interference devices) consist of a superconducting loop interrupted by one weak link, and when read out via a tank circuit they produce output signals in the order of a few tens of microvolts. When the single weak link is replaced by a dc SQUID (a superconducting loop with two junctions) a so‐called double quantization loop SQUID is formed. In this paper it is shown theoretically, and supported experimentally with thin‐film devices of three different designs, that the general behaviour can be explained by a simplified picture of the fixed critical current of the single junction of the rf SQUID being replaced by an effective critical current of a dc SQUID loop that is varied by the applied magnetic flux (i.e., we have a rf SQUID with a variable &bgr; parameter). A more detailed analysis of the experimental data and the theory of this novel device reveals its interesting nonlinear character and shows the deviations from this simple picture. It is demonstrated experimentally that output signals in the order of ≥1 mV can be obtained with a suitable read‐out mode for the tank circuit, a clear advantage when compared to conventional rf SQUIDs. With respect to dc SQUIDs, the coupling to integrated planar input coils will be unproblematic since no microwave resonances should occur in the structures.