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Large changes in resistance with magnetic field exhibited by recently discovered thin-film multilayer structures offer new opportunities in the sensors field. Compatibility of these Giant Magnetoresistive (GMR) materials with conventional semiconductor processing technology and semiconductor underlayers allows the production of inexpensive, ultra-small, smart sensors with enhanced magnetic sensitivity. The action of GMR materials is described along with their application to sensor configurations for detecting magnetic fields, magnetic field gradients, and magnetic fields from currents. Characteristics of these sensors are discussed and compared to conventional magnetic field sensors. Finally, the exciting combination of GMR materials with semiconductor underlayers in smart sensors with linear or digital (switched) outputs is explored.