This paper describes the development of non-contacting detection type torque sensor that realizes a small lost motion with light weight and low cost.Pedal-equipped electric vehicles are becoming popular in recent years. In those vehicles, torque sensors are usually necessary for measuring the pedaling force to determine the motor torque.We applied an integrated sensing structure and a non-contacting scheme utilizing inverse-magnetostrictive material to minimize the lost motions. As for the sensing material, nickel-iron alloy plating was used to obtain a wide dynamic range.In the tests using the actual structure, the output linearity deterioration occurred because of the strain distribution dispersion produced by the ratchet drive structure. Therefore, the effect of this strain distribution was examined.The inverse-magnetostrictive sensing material of nickel-iron alloy plating has an extremum on its output curve. The linearity deterioration occurs when the distribution of the strain ranges over this extremum because this coupled situation causes the errors on the sensor output yielded by the mean value over the range.This fact was verified by the Computer-Aided Engineering (CAE) and the linearity deterioration mechanism was made clear.Based on these, the sensing structure was modified to optimize the bias-torque directions and our objectives were achieved.