A Wiegand sensor is composed of a strip of Wiegand wire and a pick-up coil. The research presented in this paper examines and characterizes the fast magnetization reversal in a Wiegand wire, which leads to changes in magnetic flux density in its pick-up coil to produce the so-called Wiegand pulse to be used as a reference mark in a linear positioning system. It was observed in this research that the magnitude and duration of the pulse voltage were independent of driving frequency, indicating that Wiegand effect sensors could be ideal for use as zero-speed transducers. The repeatability of the Wiegand pulse was found to vary with different magnetic flux intensities of external magnetic field, as well as the angle between the magnetic induction line and the Wiegand wire. Through calibrated experimental and numerical parametric studies, the mechanism for producing repeatable Wiegand pulses to be used as a reference mark for precision liner positioning systems was revealed, which represents the novelty of this research. On the basis of this mechanism, the optimal design combination of the Wiegand sensor’s position with respect to the magnetization source can be obtained. Utilizing commercially available Wiegand sensors, it was demonstrated in this research that with a Wiegand pulse serving as a magnetic reference mark, positioning repeatability of 0.3 um could be achieved, which is on the same order as optical scales. The work presented in this research has engineering implications as well as offering scientific insights into magnetization mechanisms for generating enough magnetic remanence to produce a Barkhausen jump, resulting in repeatable Wiegand for use as a reference mark in a linear positioning system.