Torque sensor is a core member of automotive electric power steering system (EPS), a new threedimensional magnetoelectric torque sensor based on electromagnetic induction principle is designed. First the cylindrical structure and working principle of the sensor are introduced, then the electromagnetic induction system of sensor is simulated by using Ansoft Maxwell, the magnetic field distribution and quiescent output voltage when current is 100 mA are obtained by static analysis, and by simulating sensors work process with transient modules, it comes to that the dynamic output signal is high frequency induced voltage,whose amplitude sinusoidally changed with the relative position of system. finally the adder detection circuit is designed according to the characteristics of the output signal.