This lecture covers the principles of eddy currents, focusing on their use for crack detection in metal parts and proximity sensing. It explains the variation in impedance caused by eddy currents, mutual inductance, and the application of half-bridge measurement circuits. The lecture also discusses inductive graphics tablets, magnetic permeability, variable reluctance proximity sensors, and magnetostrictive materials. Various applications such as force sensors, anti-theft security elements, and proximity sensors are explored.