The eddy-current anomaly effects in an 0.019 in thick low-silicon sheet steel are investigated and analysed on the basis of the magnetic inhomogeneity arising from ferromagnetic domain structure. This particular steel was chosen because previous experimental work had shown that inherent time-lag effects in the magnetization process were small. However, in such a steel, flux waveform distortion arising from hysteresis phenomena adds to the anomaly effect, and a special experimental technique by which such distortion effects could be eliminated from the analysis was developed. This made it possible to test the steel, focusing attention upon the anomaly effect attributable to the magnetic inhomogeneity. The results obtained are interpreted in terms of a hypothetical domain configuration, and it is concluded that the magnetic inhomogeneity arising from ferromagnetic domain structure does account for the eddy-current anomaly, distortion and time-lag effects being of minor importance.