The development of a transducer for sensing the torque on the output shaft of a four speed rear wheel drive automatic transmission is described. Magnetoelastic polarized ring technology was selected based on its independence from shaft properties and its non-contact mode of sensing. The ring and several intermediate sleeves were attached by press fits onto an experimental shaft. The magnetic field arising from the ring with the application of torque was sensed by flux gate sensing elements. Ability to accurately measure the output torque of an engine driven transmission over its full range of torque and speed was demonstrated by dynamometer tests.