This paper presents the design and optimization of a novel eddy current speed sensor for rotating rods and cylindrical shafts. The sensor consists of one excitation coil and two pick-up coils. All coils are stationary; we consider air coils, and we also use a magnetic yoke. We utilize a copper coating on an iron rod to increase the sensitivity, and we compare the performance with the pe rformance achieved for an uncoated iron rod. 3D FEM is utilized for analyzing and for optimizing the design of the proposed sensor. The main advantages of the novel sensors are the ir simplicity, their low cost and their robust configuration. A linearity error of 0.5% has been achieved. The level of accuracy is limited by mechanical factors. A 1D analytical model has also been de veloped for rapid analysis and optimization of the sensor. An aluminum rod was also used in the measurements for a comparison with the results achieved with the iron rod.